Preamble

The House met at half-past Two o'clock

PRAYERS

[MR. SPEAKER in the Chair]

Oral Answers to Questions — WALES

Unemployment Statistics

Mr. Ioan Evans: asked the Secretary of State for Wales what are the latest unemployment figures expressed numerically and as a percentage in Aberdare, mid-Glamorgan and Wales; and how they compare with those for May 1979.

The Secretary of State for Wales (Mr. Nicholas Edwards): On 13 January 1983, unemployed claimants in Wales totalled 180,664 or 17·5 per cent., in mid-Glamorgan; 34,102 or 17·0 per cent., and in Aberdare 4,021 or 18·3 per cent. In May 1979, unemployed claimants totalled 77,177 or 7·0 per cent. Comparative figures on this basis are not available for Aberdare and mid-Glamorgan, but in May 1979 unemployed registrants totalled 1,961 or 8·9 per cent. and 15,471 or 8·2 per cent. respectively.

Mr. Evans: In view of the massive increase in unemployment—the real figure today is perhaps more than 200,000—will the Secretary of State re-examine those areas that have lost their special development area status? Does he agree that, in my constituency, where there has been a massive increase in unemployment, restoration of special development area status would help the National Coal Board to give the pilot scheme to the phurnacite plant? Will the Secretary of State examine that urgently?

Mr. Edwards: The hon. Gentleman will realise that a major review of that type might lead to upgradings in areas other than Wales, which might damage Wales. The fact that we have such a massive factory building programme and are attracting so many new allocations shows that present policies are benefiting Wales. Although the hon. Gentleman did not say so, I am sure that he will welcome the National Coal Board's decision to go ahead with the Ancit development in his constituency for which he has pressed so often and for so long.

Mr. Wigley: Does the Secretary of State agree that the fact that 36 unemployed people are chasing every job in Wales shows that the Government's employment policy has sunk to rock bottom and that there must be a change of policy if we are to see better times?

Mr. Edwards: Of course I share the hon. Gentleman's worry. That is why we have such a massive programme

of special measures. We are spending about £1½ billion on special measures in Britain during 1982–83. In the light of the problem that the hon. Gentleman has described, I am sure that he will recognise the importance of the new youth training scheme, on which we plan to spend nearly £1 billion next year.

Sir Raymond Gower: Does my right hon. Friend agree that the evil of unemployment is affecting centralised states such as France, and devolved ones and even small independent states such as southern Ireland equally and greatly? Does that not show the immensity of this international problem and evil?

Mr. Edwards: Everyone recognises that unemployment is a major international problem that has got worse and is getting worse in many countries. I am sure that my hon. Friend will welcome the fact that some of the indicators, not only in Britain but in the United States and elsewhere, show signs of growing optimism for the rest of the year.

Mr. Alec Jones: Although most of us accept that unemployment is a major international problem, why is it so much worse here than anywhere else? Why is it that countries that have fewer advantages than we are better off? Does the right hon. Gentleman agree that the greatest tragedy in the figures that he gave is for school leavers and that there are 321 unemployed school leavers in Aberdare, 2,000-odd in mid-Glamorgan and nearly 8,000 in Wales as a whole? What hope of a permanent job can he offer those young people?

Mr. Edwards: I am sure that the right hon. Gentleman will agree that many of those school leavers are getting jobs and/or training under the programmes that we have announced. A high proportion of them are getting jobs in the time scale that was laid down by the Manpower Services Commission. I am sure that he will especially welcome the new youth training scheme and all the opportunities that it provides for the proper training of our work force. That must be one way in which to improve our competitiveness the lack of which is, perhaps, the essential reason for our loss of many markets and the fact that our position is worse than that of some other industrial countries.

Storm Water Overflows

Mr. Wardell: asked the Secretary of State for Wales how many applications his office has received from the Welsh water authority for storm water overflows to be diverted into the public sewers; and how many have been approved.

The Under-Secretary of State for Wales (Mr. Wyn Roberts): The water authority is not required to seek my right hon. Friend's consent for the connection of storm water overflows to public sewers.

Mr. Wardell: When the current dispute in the water industry is over, will the Secretary of State investigate the adequacy of the Welsh water authority's assessment of the action necessary to stop raw sewage flooding into the homes of my constituents in Clydach?

Mr. Roberts: We shall not have to wait until the end of the current dispute, because I understand that short-term alleviation has been undertaken and a thorough investigation to decide the optimum measures for


improvement is being put in hand by the Welsh water authority's sewarage agent, which is the Lliw valley borough council.

Job Losses

Mr. Anderson: asked the Secretary of State for Wales how many jobs were lost in Wales by redundancy or closure in each of the last four years.

Mr. Nicholas Edwards: The information is not available in the form requested. Redundancies involving 10 employees or more were reported as due to occur as follows: during 1979, 11,663; during 1980, 45,215; during 1981, 36,432; and during 1982 provisionally 23,577.

Mr. Anderson: Do not those figures show how much deindustrialisation there has been in Wales? Is the Secretary of State not aware that all the reputable economic forecasters agree that if present Government policies continue there is bound to be a substantial increase in unemployment? What will he do about that? Does he accept that if there is, as there will be, an increase in unemployment, the effect on Wales will be greater than that on any other region because of our dependence on steel?

Mr. Edwards: The hon. Gentleman will realise that those figures do not show how much deindustrialisation there has been, because one has to strike a balance between jobs lost and jobs created. A large number of jobs have been created. The figures do not include jobs among the self-employed, for example. The hon. Gentleman suggested that Wales would be worse off than any other region. That is not true. During the present recession, despite the steel losses, unemployment has risen less severely in Wales than in the United Kingdom as a whole. The improved infrastructure and the greater diversification of our industrial base mean that in the future, we will do better than we have done relatively in the past.

Mr. Hooson: Does my right hon. Friend have any confidence that the policies that would revive inflation would contribute anything to the defeat of unemployment in Wales?

Mr. Edwards: I am sure that they would not. One of the weaknesses of many of the policies advocated by the Opposition and others is that they involve not only inflation but some control over prices and incomes, without a guarantee or expectation that the desired effect can be delivered.

Mr. John Morris: In his quieter moments, does the Secretary of State recall the way in which he used to attack the Labour Government when unemployment was a fraction of what it is now—and abused me personally, although I did not mind that? Is he proud of his stewardship of Wales during the past few years, or has he given up the ghost and has no idea of when unemployment will come down?

Mr. Edwards: No Secretary of State who has been in office when unemployment has risen massively, as it did under my predecessor and in my period of office, can be proud of that fact. However, I can be proud of the fact that, despite the severity of the recession and the economic difficulties that we face, we have probably carried out a

greater improvement in the industrial infrastructure and attracted more new jobs than in any previous period in modern Welsh history.

Mr. Alec Jones: There seems to be a difference between my right hon. and learned Friend and the Secretary of State. Does the Secretary of State not agree that the net job losses under the Government have been the worst in Wales since the war? Will he confirm that, in 1979, when the Labour Government were in office, 1,022,000 people were in employment in Wales—an all-time record high—while in June 1982, under the Conservative Administration, the total had fallen to 877,000, an all-time record low? How many of those job losses does he accept as being at least partly his responsibility?

Mr. Edwards: We all know that the numbers of unemployed have increased and that there are fewer people in work than there were when the Labour Government left office, just as employment deteriorated during the period of office of the Labour Government. Unemployment more than doubled under our predecessors. However, all of us can take comfort from the knowledge that, despite those facts, during the past two years we have allocated an all-time record amount of new factory space—nearly 1·6 million sq ft in 1981, and nearly 2 million sq ft in 1982. It is remarkable that, despite the recession, we are being so successful in attracting new jobs and the new industries that will provide the jobs of the future to which we all look.

Mr. Alec Jones: I am sure that the Secretary of State would not want to mislead the House.

Mr. John Morris: Hear, hear.

Mr. Jones: The facts clearly show that the numbers of people in employment in Wales rose from the time when the Labour Government took office in 1974 until they left office in 1979, which is the complete opposite of what has happened under the Conservative Administration.

Mr. Edwards: If the right hon. Gentleman looks tomorrow at what I have said, he will see that I in no way misled the House and that, in giving my answer, I was careful to refer to the fact that unemployment more than doubled under the Labour Government.

Welsh Development Agency

Mr. Wigley: asked the Secretary of State for Wales whether he proposes to make any changes to the guidelines issued by him to the Welsh Development Agency; and if he is satisfied with the performance of that agency.

Mr. Nicholas Edwards: New guidelines have recently been issued covering the agency's land reclamation function, and a copy is available in the Library. I do not propose to make any major changes in the guidelines for the agency's other main functions at the moment, although this is kept under review. I am satisfied with the agency's achievements to date, but I am having discussions with the recently appointed chairman and the board about its future strategy.

Mr. Wigley: Does the Secretary of State accept that, if any of the guidelines are to be changed, it is those for the creation of new jobs in Wales that should be changed? That is where the most patent failure of the agency is evident. Is he not aware of the consultants' report—the


Larsen Sweeney report—which was published a few months ago, which referred to the Welsh Development Agency as being the subject of anecdotal amusement? Does not the right hon. Gentleman feel that there is something drastically wrong, which needs to be put right?

Mr. Edwards: It is not just to say that the performance of the WDA is the subject of amusement when, since it was set up, it has constructed about 8 million sq ft of factory space, 5 million of it under the Conservative Government, and has occupied much of that factory space in the middle of a recession. There is a change in future strategy. There has been a sharp increase in the approved investment portfolio from £10·5 million to £15 million during the recent past. It is developing the investment activities of Hafren, its new investment subsidiary. The new chairman is carrying out an urgent review of its strategy with the board. I am about to have a meeting with the board to discuss its future policy.

Mr. Tom Ellis: Does the Secretary of State recall that last May he told the House that he had asked the agency to reconsider its long-term strategy? Has the agency now embarked on a new course? If so, in what direction is it going?

Mr. Edwards: Since then, Hafren has been established and there has been an upturn in the investment porfolio. A new strategy document was prepared, but the former chairman, Mr. Stephen Gray, died during the preparation of the report. I thought it right to allow the new chairman time to consider the report before meeting the board, which I intend to do within the next couple of weeks.

Sir Anthony Meyer: Is it not true that the best hope for jobs in Wales lies increasingly not so much in manufacturing as in service industries? Should not that fact be reflected in the guidelines that are given to the WDA? Might not such tourist projects as a theatre in Rhyl, in which the WDA should begin to interest itself, be taken into account?

Mr. Edwards: The present guidelines give a good deal of flexibility to the agency. It can support non-manufacturing industries. I agree that there should be a proper balance, and I am seeking to achieve it. The Rhyl sun centre is an example of how a service project can give substantial job opportunities to the area. We want to have a proper mix in every part of Wales.

Mr. Barry Jones: Does the Secretary of State agree that to achieve its finest potential the agency would require the Government to reflate the economy drastically, albeit in a controlled way? May I remind the Secretary of State that in Clwyd and Gwynedd manufacturing jobs in the pipeline over the next four years total only 3,750? When does he think there may be news of the Finnish pulp paper mill at Shotton?

Mr. Edwards: I believe that we shall have a decision on that matter before much longer. I am sure that the hon. Gentleman will welcome the recent annnouncement by the Welsh Development Agency of a £6 million-plus reclamation project in the area. Whatever the hon. Gentleman's views of reflation, most people in industry would think that low interest rates and the keeping down of industries' costs are perhaps rather more important for future job creation.

A55 (Bodelwyddan)

Sir Anthony Meyer: asked the Secretary of State for Wales when he expects to provide short-term alleviation of the dangers to motorists and pedestrians arising from the configuration of the A55 Bodelwyddan.

The Under-Secretary of State for Wales (Mr. Michael Roberts): As I told my hon. Friend on 22 November, the county council has been requested to improve the junction between Ty Fry lane and the trunk road. Its investigations show that the necessary diversion of underground services would cause a substantial delay in completing the work. A simpler scheme which could be implemented quickly is now being prepared.

Sir Anthony Meyer: I thank my hon. Friend for that informative reply, but is he aware that it is now 10 weeks since he undertook to study carefully a constructive suggestion that I made for the immediate improvement of the position at Bodelwyddan by painting double white lines along the road? Can he give me any news of that?

Mr. Roberts: The initial report from the county surveyor does not show that the use of double white lines would improve safety. However, I am studying that point carefully. I know how strongly my hon. Friend feels and I can assure him that agreement about remedial measures will be reached quickly and action to implement such measures will follow immediately.

Dr. Roger Thomas: Further to the development on pedestrian safety on trunk road development in Wales, will the Minister consider sympathetically the welter of protest about pedestrian crossings and underpasses, particularly on the Carmarthen southern bypass at Pen-sarn?

Mr. Roberts: rose—

Mr. Speaker: Order. That does not arise on this question.

Welsh Development Agency

Mr. Knox: asked the Secretary of State for Wales how many new factory units and how many square feet of factory space have been built by the Welsh Development Agency since its inception.

Mr. Nicholas Edwards: Between January 1976 and December 1982 the Welsh Development Agency completed 1,022 advance factory units, 11 bespoke factory units and 66 factory extensions, totalling in all just over 8 million sq ft.

Mr. Knox: How many of those factory units are occupied? Is my right hon. Friend satisfied that the supply is sufficient to meet the demand, particularly if there is an upturn in the economy?

Mr. Edwards: The vacancy rate has risen to about 15 per cent. but in view of the scale of the factory building programme that has been carried out, that is not surprising. We expect those figures to fall if allocations continue at anything like the rate of the past couple of years.

Mr. Hudson Davies: Although one wishes to recognise the work of the Welsh Development Agency, does the Secretary of State concede that it is in the end occupancy rather than buildings that matters? How much of the 8 million sq ft already built is at present unoccupied, either through having been vacated or through failure to obtain tenants?

Mr. Edwards: I cannot give an immediate answer, but I shall write to the hon. Gentleman and give him the present exact unoccupied square footage. The vacancy rate at present is approximately 15 per cent., which is by no means unreasonable in present circumstances. I remind the hon. Gentleman again that in 1981 in Wales in Government factories generally, including those of the WDA, we allocated about 1·6 million sq ft of factory space. In 1982 the figure was nearly 2 million sq ft. Individual agencies are also doing well. One of our problems in Cwmbran is that it has done so well that there is a shortage of factory space.

Mr. Alec Jones: May I remind the Secretary of State that the vast majority of Opposition Members wish to see the WDA move from one success to another? Many of us, therefore, were somewhat disturbed to see a recent HTV programme which contained wide discrepancies between the figures for job creation given by the WDA and those given as a result of the HTV research. We were somewhat dismayed to hear that the WDA had refused to take part in the programme. Will the Secretary of State assure us that no pressure was put on the WDA not to take part in the programme? Will the Secretary of State invite, if not direct, the WDA to publish a leaflet giving the facts so that we can all see and judge the true position?

Mr. Edwards: I was about to tell the right hon. Gentleman that the matter was entirely one for the WDA, when he asked whether any pressure had been put on it. I confess that I never heard about that broadcast, and I am certain that no pressure was applied to the WDA. It is entirely up to the WDA whether it chooses to be represented in a particular broadcast. I shall certainly draw the board's attention to the right hon. Gentleman's points. I am sure that it will consider responding.

Unemployment Statistics

Mr. Roy Hughes: asked the Secretary of State for Wales what is the latest figure of the number of males unemployed in Newport, Gwent; and what percentage of the male working population in Newport this represents.

Mr. Nicholas Edwards: On 13 January male unemployment in the Newport travel-to-work area totalled 10,650, or 18·8 per cent.

Mr. Hughes: As the Secretary of State read out those appalling figures, should he not have been hanging his head in shame? Does he appreciate that he is talking about Newport, which is literally the industrial capital of Wales? It has a favourable geographical position and excellent communications, but it has been brought to its knees solely by the Government's monetarist policies. Should not the Secretary of State resign?

Mr. Edwards: I share the hon. Gentleman's anxiety about unemployment problems in the area. However, one would not have gathered from his question that the area is particularly well placed to attract new industry. At present, Mitel is recruiting absolutely flat out at Caldicott; Inmos is also recruiting flat out; AB Electronics has recently taken an investment decision that is of importance to the area; Avana Bakeries is also engaged on a major expansion project, and most recently we have information of interest from a continental high technology company for

the Gilwern site in north Gwent. Gwent is particularly well placed at the moment and there are a great many exciting projects building up to full employment.

Welsh Development Agency

Mr. Ellis: asked the Secretary of State for Wales what proportion of the Welsh Development Agency's total expenditure in each of the past three years has gone towards (i) providing business premises to let and (ii) purchasing holdings in assisted companies in (a) manufacturing and (b) service industries.

Mr. Nicholas Edwards: In 1979–80, 63·3 per cent., 5·5 per cent. and 0·5 per cent. respectively; in 1980–81, 71·8 per cent., 0·7 per cent. and 0·1 per cent. respectively; and in 1981–82, 69·6 per cent., 2·3 per cent. and 0·2 per cent. respectively.

Mr. Ellis: Does the Secretary of State agree that there is an urgent need for the agency to undertake a much more direct entrepreneurial role in Welsh industry? Does he further agree that the figures that he has given show that virtually no progress has been made in that direction? Will he undertake to have a word with the chairman of the board with a view to moving in that direction?

Mr. Edwards: I partly answered the hon. Gentleman's question in earlier answers. He should recognise that the figures do not represent the take-up of the net approved portfolio investments made during the past year, during which there has been a sharp upturn. As a result, the agency expects to make 100 new investments, including Hafren Investments, in the current financial year. That represents a significant change of direction by the agency. It is precisely those points that I shall discuss when I meet the board.

Mr. Anderson: Does the Secretary of State recall that when, in 1980, we had the shocking news about the steel redundancies throughout Wales, he came to the House and made a bold prediction of the job effects of the increased allocation by the WDA and the Cwmbran development corporation? How has reality measured up to his prediction in 1980?

Mr. Edwards: We built more factory space than we had planned. We have certainly allocated more factory space during the past few years that I would have forecast then, and I am confident that when all those jobs materialise, which will happen over two or three years, our forecast will be amply justified.

Mr. D. E. Thomas: Can the Secretary of State confirm that the number of empty factory premises belonging to the agency is nearer 40 per cent., and not 15 per cent. as he quoted in answer to an earlier question?

Mr. Edwards: No, I cannot confirm the information given by the hon. Gentleman. I have given him the vacancy rate. It is also fair to say that, apart from the WDA agencies, many private factories are available in Wales. We should look not only at Government factories but increasingly at Government and private factories together to get a true picture of the availability of factory space and our success in getting that factory space occupied.

Water Rates

Mr. Geraint Howells: asked the Secretary of State for Wales what representations he has received from farming organisations in Wales regarding water rates; and if he will make a statement.

Mr. Wyn Roberts: None during the past year.

Mr. Howells: Does the Minister believe that those who live in Wales should pay a higher water rate than those who live in Birmingham or London? If he does not, what are his plans?

Mr. Roberts: The hon. Gentleman understands the system that resulted from the Water Act 1973 and that which is proposed in the Bill before the House. It provides for different charges to be levied in different areas. The way to reduce those charges, as we have repeatedly said, in Wales as elsewhere, is by increased efficiency and productivity. We are trying to achieve that through a new, more businesslike authority.

Mr. Wigley: Will the Minister link up with both the farmers organisations and the Welsh water authority to discuss leaking pipes on farms? Is the Minister aware that a farmer in my constituency received a bill for £800, which is about 10 times his normal bill, because a pipe was leaking on his land and he was charged for the water that had disappeared without anyone noticing? Will the hon. Gentleman raise that point with the authorities?

Mr. Roberts: The maintenance of a water supply pipe beyond the water authority's communication pipe is the responsibility of the owner or occupier. Regular checks of the meter and the supply pipe should lead to early detection of leaks.

Sir Anthony Meyer: If the water workers, in threatening to endanger the health of the public, can obtain for themselves the substantial pay rise for which they are striking, will that make it any easier for the Welsh water authority to keep down water charges?

Mr. Roberts: This question relates to representations from farming organisations in Wales. There is another question about the strike, to which I hope my right hon. Friend will reply.

Dr. Roger Thomas: What financial relief is available to hill and upland farmers whose costs for piped water connections are more prohibitive than ever?

Mr. Roberts: We have had no representations on that point, but I should be happy to consider the matter.

Unemployment Statistics

Mr. Ednyfed Davies: asked the Secretary of State for Wales what is the current level of unemployment in Wales; what percentage increase this represents since the same date in 1979; and what are the corresponding figures for mid-Glamorgan.

Mr. Nicholas Edwards: On 13 January 1983 unemployment claimants in Wales totalled 180,664 and in mid-Glamorgan 34,102. In Wales this represents an increase of 109·1 per cent. since January 1979. A comparable figure for mid-Glamorgan is not available.

Mr. Hudson Davies: How can the Secretary of State blandly state those figures without expressing horror at the

enormity of the unemployment problem in Wales, which has been created by the Government's policies? Is he aware that, in human terms, the 34,102 unemployed in mid-Glamorgan equate with only 752 vacancies? For every 45 people unemployed, there is only one vacancy. In Bargoed in my constituency the comparable figures are that, for every 57 people unemployed, there is only one vacancy. Is it not time that the Secretary of State made his personal protest against the effects and implications of the Government's policies?

Mr. Edwards: It may be characteristic of the party that the hon. Gentleman represents that it is more interested in expressions of emotion and protest than in practical alternative policies. His constituents are looking for policies that will improve the position, but they will look in vain to his party.

Sir Raymond Gower: As my right hon. Friend has made it clear that he is anxious to promote any means of greater employment, provided that it does not induce the return of inflation, will he pay special attention to the assurances of the house building organisations in Wales that, with modest expenditure—far less than the expenditure on manufacturing industry—they could create many jobs with a moderate increase in production?

Mr. Edwards: My hon. Friend will be aware that almost every real expansion of private house building that has ever taken place has been on the basis of low interest rates, which are a prime objective of Government policy. He will also be aware that, at present, substantial resources are available to local authorities in Wales for house repairs, renovation and building that are not being fully utilised.

Mr. Ioan Evans: Is the Secretary of State aware that the Labour party, the TUC and the CBI have put definite proposals to the Government on how to reduce this massive unemployment? Do the Government realise that they must reverse the policies that they have put forward while in office, which, although there is a world recession, have added to the recession by the deliberate creation of unemployment?

Mr. Edwards: All those organisations have put forward massive inflationary packages and, linked to them, proposals for controlling prices and incomes without a demonstration of how they would be more likely to succeed now than they did in the past.

National Parks Authorities (Membership)

Mr. Hooson: asked the Secretary of State for Wales what information he has as to the proportion of members of national parks authorities in Wales who are resident within the park areas; and whether this proportion has varied significantly since May 1979.

Mr. Nicholas Edwards: The proportions are 56 per cent. for the Brecon Beacons, 33 per cent. for the Pembrokeshire coast and 44 per cent. for Snowdonia. The corresponding proportions in 1979 were 41 per cent., 33 per cent. and 33 per cent.

Mr. Hooson: Will my right hon. Friend ensure that as many as possible of his appointees to the authorities are people who reside in the national parks, so as to ensure greater responsiveness to the interests of local people?

Mr. Edwards: My hon. Friend will be aware that two-thirds of the appointments to national park committees are the responsibility of county and district councils and that in making my appointments I am primarily concerned with the skills and expertise that individuals will bring, rather than with local representation. None the less, my hon. Friend will be glad to know that, during this Government's term in office, appointments by both the local authorities and myself have represented an increase in the number of those who reside within the national parks.

Mr. Roy Hughes: May we have the same criteria established for having local people appointed to our public bodies, because it is noticeable that there have been some grave exceptions in the appointments made by the Secretary of State? One example is the unknown Ross solicitor who suddenly found himself chairman of the health authority in Gwent.

Mr. Speaker: Order. That does not arise on this question.

Mr. D. E. Thomas: Will the Secretary of State explain the criteria for the selection of his nominees to national park authorities, because some nominees who have been approved by the Countryside Commission are then turned down by the Welsh Office, whereas members of some political parties are nominated by the Welsh Office?

Mr. Edwards: There is no truth in the hon. Gentleman's allegation. I discuss the appointments with the Countryside Commission. The hon. Gentleman will find that I have appointed a wide variety of interests to the national parks committees and that I have included members from several political parties.

Forestry Commission (Manpower)

Mr. D. E. Thomas: asked the Secretary of State for Wales what was the total number employed by the Forestry Commission in Wales in 1960, 1970, 1980 and at the latest date for which figures are available.

Mr. Nicholas Edwards: In 1960 the number of employees was 3,410; in 1970 - 1,809; in 1980 - 1,350 and at the end of January 1983 - 1,195.

Mr. Thomas: Does the Secretary of State accept that the cash limits policy being imposed by his Government on the Forestry Commission is now leading to a substantial reduction in the living standard of forestry workers? Will he confirm that the Treasury has told the Forestry Commission that there will have to be a pay rise of under 3 per cent. to forestry workers in the next financial year?

Mr. Edwards: I cannot agree with the hon. Gentleman. There has always been a relationship between the pay of forestry workers and that of farm workers, but account must also be taken of the pension and other associated benefits that are available to forestry workers. These were taken into account in the recent round of pay negotiations and will no doubt be taken into account in the next round.

Council House Sales

Sir Raymond Gower: asked the Secretary of State for Wales what is his most recent estimate of the numbers of tenants of local authorities and of housing associations in Wales, who have purchased their dwellings since May 1979; and if he will make a statement.

Mr. Wyn Roberts: Between May 1979 and September 1982, 22,293 local authority dwellings and 12 housing association dwellings were sold to tenants in Wales. A further 1,181 dwellings were sold by the Cwmbran development corporation and the Development Board for Rural Wales. These figures amply demonstrate the strong desire among public authority tenants to own their own homes. They underlie the Government's proposals in the Housing and Building Control Bill to extend the right to buy to others who have been excluded hitherto.

Sir Raymond Gower: Is my hon. Friend aware that this is much better than the report he gave me some months ago? Does he expect this good progress to continue?

Mr. Roberts: Certainly. By the end of September about 43 per cent. of the total number of applications had resulted in sales. We are, of course, continuing to monitor authorities to ensure that steady overall progress is made in Wales.

Mr. Anderson: Does the Minister recall the terms of a recent written reply to the effect that each local authority receives just over £3,000 for each unit of accommodation sold, yet has to spend in excess of £23,000 to replace that unit? How does that possibly make sense, and what lessons does the Welsh Office draw from this discrepancy?

Mr. Roberts: The hon. Gentleman knows, because I have told him and the House on many occasions, that simply because a council house is sold it does not mean that it is removed from the total housing stock. Of course, local authorities gain revenue from the sale of council houses that can be applied to meet housing needs.

Sir Anthony Meyer: Is my hon. Friend aware that I am receiving an increasing number of complaints from tenants who have tried to buy their council houses from the borough of Rhuddlan? If this authority is experiencing particular difficulties in maintaining the programme, will my hon. Friend arrange for it to receive advice and help as necessary?

Mr. Roberts: My hon. Friend is absolutely right. There is certainly room for improvement by a small number of authorities. I am afraid that I have to say that Rhuddlan is among those authorities.

Water Industry (Dispute)

Mr. Grist: asked the Secretary of State for Wales if he will detail the effects of the water workers' strike in Wales; and if he will make a statement.

Mr. Nicholas Edwards: A large number of people in Wales have been made to suffer anxiety and inconvenience by this strike. Currently, almost 1 million people in the Welsh water authority's area are having to boil water, while 3,700 properties—that is, about 10,000 people—are without a piped supply. A substantial offer—7·3 per cent. over 16 months—is on the table and is available immediately, and the independent mediator's report presents clear opportunities, given genuine improvements in productivity, for increased earnings. The way is open, and I hope that the water workers will return to work immediately so that negotiations may continue and bring to an end a needless dispute that is causing great distress to the sick, the disabled, the elderly and the general public.

Mr. Grist: Will my right hon. Friend confirm that Wales is the area worst hit by this shameful strike, that the position is getting worse, and that private contractors and, if necessary, troops will be used wherever necessary?

Mr. Edwards: I am not sure that it is right that the position is getting worse, although the number of those having to boil water has certainly increased. The number without piped supplies has been reduced. The right way forward at the moment is to deal with each problem as it arises. I am sure, however, that it is right to urge workers to go back to work and to continue to negotiate in those circumstances, and not while they are still causing so much widespread inconvenience, on the arrangements that offer the genuine possibility of further increases.

Mr. Alec Jones: Has the Secretary of State seen today's Western Mail, which shows that a grade I waste inspector who produced a pay packet of £85·85 is expected to believe from the television and wireless that his £85·85 has mysteriously become the much publicised figure of £135? Does the Secretary of State agree that the use of average figures does not help the average worker understand the problems? Does he further agree that the best place to settle the strike is around the negotiating table and not on television chat shows?

Mr. Edwards: The figures that are being quoted are from the new earnings survey, which is being used by the unions in their comparisons in support of their claim. I entirely agree with the right hon. Gentleman, however, that the proper place to settle is around the negotiating table. As there is a very reasonable offer on the table of 7·3 per cent. for 16 months, and as paragraph 8 of the mediator's report has revealed the opportunities that are available for further increases, I hope that workers will go back to work, will negotiate and will not continue to cause inconvenience. They will, apart from anything else, of course, be losing substantial earnings so long as they remain out.

Unemployment Statistics

Mr. Barry Jones: asked the Secretary of State for Wales by what amount unemployment has increased in the Deeside travel-to-work area, Clwyd and Wales since May 1979; and if he will make a statement.

Mr. Nicholas Edwards: Between May 1979 and January 1983 the number of unemployed claimants in Wales increased by 103,487. In the Shotton travel-to-work area and Clwyd between May 1979 and October 1982 the number of registered unemployed increased by 5,837 and 13,779 respectively; between October 1982, when the new basis was introduced, and January 1983 the number of unemployed claimants increased by 360 and 1,584.

Mr. Jones: Will the right hon. Gentleman do his utmost to speed up the tactical and strategic road improvements that are required in my constituency to hasten industrial regeneration? Does he know that the Plough Lane district distributor road is unlikely to be started until late in the 1980s? In a strategic sense, what help will he give to Clwyd county council to bring about the third crossing of the River Dee, which will give a major boost to industrial estates in Flint and on Deeside?

Mr. Edwards: I agree about the importance of the proposals for a third Dee crossing. I discussed the report

of the Clwyd county council and the Alyn and Deeside district council at an interesting and useful meeting on 19 January. They agreed that it was necessary to provide much more detailed information about the proposals, and discussions will continue on that basis.

Oral Answers to Questions — CHURCH COMMISSIONERS

Vicarages and Parsonages

Mr. Greenway: asked the hon. Member for Wokingham, as representing the Church Commissioners, if he will make a statement on the condition and suitability of vicarages and parsonages.

The Second Church Estates Commissioner, Representing the Church Commissioners (Sir William van Straubenzee): There are at present 8,800 official parsonage houses, of which 7,200—82 per cent.—are regarded as providing suitable accommodation. Whilst the commissioners make substantial grants to dioceses to assist with the cost of repairs, maintenance is a diocesan responsibility.

Mr. Greenway: I thank my hon. Friend for his reply. Is it not a fact that too many incumbents are still required to live in unmanageably large houses and that some dioceses could be more punctilious in the maintenance of these houses? Is it not also a fact that some parishes still treat their vicar's parsonages as though they were meeting places rather than the home of the incumbent?

Sir William van Straubenzee: Substantial progress has been made in the matter raised by my hon. Friend. For example, during the past five years some 1,076 parsonage houses have been replaced, by building or by purchase, at a cost to the Church Commissioners of £9·2 million in grants. If my hon. Friend has a specific case in mind in which a diocese has not performed as he thinks it should with regard to maintenance, if he will give me if e details I shall gladly pass them on.

New Church Buildings

Mr. Murphy: asked the hon. Member for Wokingham, as representing the Church Commissioners, what guidelines are provided for the erection of new church buildings.

Sir William van Straubenzee: In 1975 the Council for the Care of Churches published a document entitled "Procedure for new Church Buildings: Guidelines". I am sending my hon. Friend a copy.

Mr. Murphy: I should like to thank my hon. Friend, as I am sure that the reply will be most helpful. Will he say whether it is the practice of the Church Commissioners to take soundings as to the use of new church buildings for a wider local community use?

Sir William van Straubenzee: It is not generally understood that the commissioners become involved only if it is proposed to erect a consecrated building. I am sorry that that is such a narrow point, but it is one I have to make. I am perfectly certain, however, that in modern days both the commissioners and, in cases where they are not involved, other Church authorities, would today always have regard to the wider, more general use of a church building than purely for public worship.

Oral Answers to Questions — EDUCATION AND SCIENCE

Museums and Galleries (Touring Exhibitions)

Sir David Price: asked the Secretary of State for Education and Science what steps he is taking to assist the national museums and galleries in organising touring exhibitions for the benefit of the provinces.

The Minister for the Arts (Mr. Paul Channon): The national museums and galleries already have extensive arrangements for loans to the regions, which I hope will be maintained. In addition, the Government indemnity scheme can provide cover for loans, and the Arts Council operates travelling exhibition services and an information bulletin.

Sir David Price: I thank my right hon. Friend for that reply. Does he agree that the more that the national museums and galleries centred in London can take selected parts of their massive collections around provincial Britain, the more we shall be able to bring together the entire nation in its enjoyment of the arts? Is this not part of the one-nation concept?

Mr. Channon: I agree. The national museums do a great deal already in taking their collections to the provinces. I hope that that will continue and, if possible, increase. If my hon. Friend is interested, I shall send him a list of all the exhibitions and loans that are taking place from the national museums.

Mr. Greville Janner: When considering how to help touring exhibitions, will the right hon. Gentleman please bear in mind the need for exhibitions of decorative arts and history and not merely exhibitions of paintings? Areas and centres such as the Leicester New Walk art gallery are already well served by the Arts Council's provision of painting exhibitions.

Mr. Channon: Yes, I agree. I think that there are exhibitions of the sort that the hon. and learned Gentleman has in mind. He makes a fair point.

Mr. Jessel: Would the provinces not further benefit from the permanent loan of some of the surplus stocks—my hon. Friend the Member for Eastleigh (Sir D. Price) referred to "massive collections"—and large quantities of works of art which the national museums do not have room to display?

Mr. Channon: Some of the national museums display everything that they own. That is done, for example, by the National gallery. The Tate gallery and other galleries have pictures that they do not show. This problem would be resolved at the Tate gallery to some extent if the Tate gallery north were to go ahead. There are other permanent exhibitions, but I take my hon. Friend's point.

Royal Opera House and Royal Shakespeare Company

Mr. Blackburn: asked the Secretary of State for Education and Science if he will give further details of the special financial scrutiny which he announced on 20 December 1982, Official Report, c. 665.

Mr. Murphy: asked the Secretary of State for Education and Science if he will make a statement about the proposed scrutiny of the finances of the Royal Opera House.

Mr. Channon: The terms of reference for the financial scrutinies will be:
To examine the financial affairs and prospects of the Royal opera house and the Royal Shakespeare company and to make recommendations
The study team will be led by Mr. Clive Priestly, undersecretary in the Management and Personnel Office, and comprise an independent consultant, Mr. David Allen, and an accountant, Mr. Ian Trumper.

Mr. Blackburn: I congratulate my right hon. Friend on the increased support for the arts and on the assurance that he has given this afternoon. Does he accept that the financial scrutiny of the Royal opera house and the Royal Shakespeare company should be in line with that of other national companies and with overseas companies such as La Scala, Milan?

Mr. Channon: I thank my hon. Friend for his kind remarks. With the Royal opera house it will be necessary to make some comparisons with what happens at other great international opera houses. These organisations receive large sums of public money and from time to time there should be special financial scrutiny. This is what we have arranged.

Mr. Murphy: May I also congratulate my right hon. Friend on introducing these financial scrutinies? How long will the study team take to present its report? Secondly, will the staff be consulted?

Mr. Channon: Yes, the staff will certainly be consulted at all stages of the scrutinies. I hope that the studies will take about six months.

Mr. Eastham: Has the Minister's attention yet been drawn to a letter that I sent him on 5 January? It dealt with correspondence that I had received purporting to have come from a political adviser at the Department of the Environment, Mr. Ed Berman. He advised arts associations in the north-west that there was £1·5 billion sloshing about and that they had only to apply to local authorities for the money? Will the Minister please make a statement on this?

Mr. Channon: I must confess that I do not recall the hon. Gentleman's correspondence. I shall check immediately. It seems that a very surprising remark was made. I shall look into the matter urgently.

Mr. Nicholas Baker: Will my right hon. Friend adress his financial scrutiny of the Royal opera house to the charging and ticket issuing policy of that body? Is he aware that many of us feel that its policy has restricted the number of people who have been able to obtain tickets, and that now, in changed financial circumstances, few people apply for tickets because they believe that the number of those who obtain them is very small?

Mr. Channon: Ticket prices and box office policy will be among the matters that the scrutiny team will consider. It has always been the policy of the Royal opera house to offer comparatively cheap tickets in addition to very expensive ones so that people of modest means can go to the Royal opera house.

Mr. Whitehead: In view of the Rayner connections of this group, will the right hon. Gentleman urge it not to follow the unhappy precedent of the recent Rayner report on the Victoria and Albert museum, and to visit the various institutions that it is surveying while they are open? Will


accountants' or consultants' fees that stem from this exercise come only after tendering for the work that has to be done?

Mr. Channon: No. I think that it has been decided who will undertake the scrutinies, as is the normal practice. Without accepting what the hon. Gentleman said about the scrutiny of the Victora and Albert museum, I can assure him that the scrutineers have every intention of making exhaustive visits to both organisations.

Arts Council (Touring Budget)

Mr. Silvester: asked the Secretary of State for Education and Science whether any changes have been made by the Arts Council in the touring budget following his statement of 20 December 1982, Official Report, column 664–65.

Mr. Channon: The current allocation for touring in England in 1982–83 is £7·5 million, including an additional sum of £400,000 provided from the supplementary grant announced on 20 December 1982. The touring budget for 1983–84 is £7,865,000.

Mr. Silvester: I congratulate my right hon. Friend on his care about touring. Does he recognise that one of the distressing aspects of the saga of the visit of the Royal opera house to Manchester was its on—and-off nature, despite the great deal of investment and commitment that the operation received? Is he prepared to say that with the new arrangements people will be able much more to rely upon the visits taking place, instead of the previous rather doubtful prospect?

Mr. Channon: I understand my hon. Friend's concern. I am pleased to say that the Royal opera company has been able to announce that its visit to Manchester will take place later this year. We must all hope that it will be a tremendous success. Future plans will be discussed in detail with everyone concerned, including the Greater Manchester council and the city of Manchester. I hope that we can avoid future uncertainties in this way.

Mr. Whitehead: Bearing in mind the outrage in Greater Manchester when the Royal opera house originally called off its visit, does the right hon. Gentleman agree that we should say publicly in the House that we think it should be an annual obligation on the national companies to tour in this way, and that they should not merely return to touring when they have been bailed out by the payment of a one-off sum?

Mr. Channon: Most of the national companies tour extensively. The Royal opera house has special problems, including enormous costs. There are those who consider that the money could be better spent than on tours by the Royal opera house. I accept that the national companies have an obligation to tour.

Arts Council (Theatre Grants)

Mr. Greenway: asked the Secretary of State for Education and Science what was the total Arts Council grant to theatres in the last year for which figures are available.

Mr. Channon: The Arts Council estimates that its grants to theatres in Great Britain in 1982–83 will total just under £26·3 million compared with the previous year's total of nearly £23·1 million.

Mr. Greenway: I welcome the increase that my right hon. Friend has mentioned and I thank him for it. Does he agree that the Royal Shakespeare company has given outstanding service to the arts in both London and Stratford on Avon and in tours around the world? What specific help is the Arts Council giving the company in grants this year?

Mr. Channon: I agree entirely with my hon. Friend about the Royal Shakespeare company. This year it received an extra settlement of £850,000 from the supplementary grant that I announced on 20 December 1982. It is to receive grant next year of £3·6 million as opposed to £3 million last year. Extra money has been made available to it, exceptionally, of nearly £1½million.

Mr. Campbell-Savours: Is it not true that there is a clear emphasis in allocation of Arts Council grants towards the more affluent areas, leaving the industrial areas very often culturally deprived? What will the Minister do to redress that imbalance, particularly as the quality of life is so closely linked to the pursuit and support of the arts?

Mr. Channon: I do not accept the hon. Gentleman's premise. He may be interested to know that this year the basic grant for the northern area was £1·72 million, which was a rise of 11 per cent. over last year, and that in addition it received a further £60,000 in supplementary grants. There has thus been a substantial increase for the north.

Telecommunications Policy

The Minister for Industry and Information Technology (Mr. Kenneth Baker): With permission Mr. Speaker, I will make a statement about telecommunications policy.
After privatisation, British Telecommunications should be able to develop and diversify in a dynamic manner not only in the area of existing telecommunications services but in the new information technology systems on a worldwide basis. This should benefit the customer, the country, investors, BT and its staff. The Government recognise the public concern that there should be no opportunity for BT plc to fix excessive charges to customers in the areas where it has a virtual monopoly for the time being. To this end my right hon. Friend the Secretary of State announced Second Reading of the Telecommunications Bill the appointment of Professor Stephen Littlechild of Birmingham university to carry out a study of these issues. Professor Littlechild's report is being published today and copies are available in the Vote Office. The Government are grateful to Professor Littlechild for undertaking this important task.
Professor Littlechild has made two major recommendations concerning the price regime after privatisation and the extent of competition. As regards pricing policy, he recommends that BT plc should be obliged for five years to keep below the increase in the RPI any increase in its prices for domestic rentals, local calls and other services of particular concern taken together. The Government accept this approach but will want to give further consideration to the range of services to be included within the price limitation, for example charges for installation and trunk calls. We shall also be considering the period for which it should apply. It will be important that the precise formula should be seen to be soundly based and fair both to the consumer and to BT. BT will be obliged to observe the arrangement finally determined and the powers of the Director General of Telecommunications under the Bill are adequate to ensure that it is complied with. These arrangements are aimed at securing a continuing improvement in BT's efficiency and a continuing reduction in the real cost of telephone services to the consumer across the country.
Professor Littlechild also says that competition is by far the most effective protection against monopoly. He sees his price limitation proposal as a safeguard that is required only until competition develops. The Government accept this approach and accordingly I can now announce further initiatives to promote competition.
First, customers who have standard BT sockets will be free to purchase from any supplier the first telephone for connection to direct exchange lines. I shall table an amendment to the Telecommunications Bill to give effect to this change. BT and the manufacturing industry need time to adjust, but I intend that by the end of next year all customers who want to exercise this choice will be able to do so.
Secondly, the maintenance of all new call routeing apparatus will be opened to competition by persons approved by the Secretary of State. BT itself will remain free to offer a maintenance service, but on a fair, commercial basis. I intend to introduce an amendment to the Telecommunications Bill to provide for licensing of

those maintaining call routeing apparatus. I shall also be consulting BT, the industry and other interested parties on the phasing in of these arrangements, which I expect to be completed within three to four years. The ending of the prime instrument monopoly and of BT's monopoly over the maintenance of all call routeing apparatus, means that the entire market for new telecommunications apparatus will be open to competition.
Thirdly, the Government accept that the current restrictions on Mercury's supply of international services should be eased. This will require discussions with other Governments. A study on the provision of international services is nearing completion and after consultation with interested parties I shall make a further statement. I would hope to be able to do so by the end of April this year.
Fourthly, the Government accept the principle of reducing restrictions on the resale of capacity on private telecommunication circuits leased from BT and other public telecommunications operators, but I recognise that this could have considerable implications for BT's revenue. I shall want to consider the terms and timing of introducing the changes after consultation with BT and other operators.
Fifthly, the Government believe that competing public networks should have the right to interconnect on appropriate terms with BT's networks. In return, BT must have the right to charge operators such as Mercury and the two cellular radiophone networks access fees on a non-discriminatory basis, which will contribute towards the cost of providing the national asset of our country-wide local networks. BT's own trunk and international divisions should also be subject to access fees on the same basis. These access fees will generate a significant revenue for BT to cover emergency 999 services, which are free, and any losses incurred on call boxes and other services, particularly those in remote and rural areas. The access fees will safeguard the continued provision of these services without subsidy from the taxpayer, thus maintaining the universal service.
The Government recognise the importance to the national economy of BT's vital role in telecommunications. We are phasing in these new measures of competition in step with progress towards moving BT out of the public sector and out of the present web of Government controls. This is an expanding and rapidly changing market, and the greatest benefits to Britain, the consumer and the telecommunications industry will come from fuller and fairer competition. The arrangements that I have announced today will help achieve this.

Mr. Stanley Orme: The Minister's statement has been made against the background of the Telecommunications Bill—a major measure—clause 3 of which is being debated in Committee. We were promised a draft licence by the Government but did not get it. We were given only an outline. We have had three publications from the Government, called "Ringing the Changes", which have added confusion to the debates on the Bill. Does the Minister not think that to introduce Professor Littlechild's report in the middle of our consideration of the Bill is unprecedented in parliamentary terms?
The foreword to the report says that Professor Littlechild
shall study and evaluate proposals to regulate BT's profitability, having regard to the objectives set out in Clause 3 of the Telecommunications Bill".


We have been discussing clause 3 for several sittings of the Committee, and the Minister now has the effrontery to introduce the report in the middle of those discussions.
The Minister probably saw the report yesterday in one of the Sunday papers about the confusion over pricing policy and whether the consumer might be subsidising sections of industry. We wish to discuss pricing and Professor Littlechild's complicated and detailed proposals in some detail. We feel it is wrong for the Minister to produce this report today and expect the Committee to go ahead tomorrow.
By breaking the prime instrument monopoly the Minister is, in effect, allowing outside contractors to provide the prime instrument, while still using the network. Will this not create confusion over breakdowns and repairs? Who will be responsible? What about the effects on jobs for thousands of workers in BT? Will not imports flood in? What has the Secretary of State to say about that? This measure is an open invitation to imports to flood in.
What effect will allowing Mercury on to the international market at this early stage have on BT's finances and future prosperity? May we have more details about the resale in relation to private telecommunications? Will someone be able to buy a series of outlets and relicense them? Will there be any control of those prices? How will the Government monitor that? A major change to the Bill is proposed. The Minister says that he will move amendments in Committee. This measure will further dismantle a crucial part of the public sector, and we see Professor Walters' sticky fingers all over this document. Indeed, he was probably the motivating force behind Professor Littlechild's appointment.
We want parliamentary time to discuss the Littlechild report, and therefore we ask that consideration of the Bill be suspended so that we can discuss this issue. It involves a major British industry and affects 250,000 workers. It also affects the telecommunications system of the United Kingdom. The hon Gentleman has dropped this report on the House when the Bill is in the middle of its Committee stage, and he therefore has no right to proceed with the measure. We ask him to withdraw the Bill.

Mr. Baker: The right hon. Member for Salford, West (Mr. Orme) has pressed me consistently in Committee for more information, and I have assisted the Committee by providing an almost unparalleled amount of information for our discussions upstairs. Only last week he demanded that I publish the Littlechild report. On Second Reading my right hon. Friend the Secretary of State for Industry said that we had asked Professor Littlechild to report and that we would publish the report.
I remind the right hon. Gentleman that there have been more than 80 hours of debate in Committee. We have been subjected to speeches lasting as long as five, four and three hours. An outrageous filibuster has been going on upstairs. So far we have debated only three groups of amendments to clause 3. There are another 20 groups of amendments to clause 3 to debate. It so happens that we are approaching the pricing part of clause 3, and so it is entirely appropriate that the Committee should meet tomorrow to debate this subject further.
The right hon. Gentleman says that this measure represents a major change of policy, but it is an extension

of the policy that my right hon. Friend the former Secretary of State for Industry announced in July 1980, and which I extended in July 1981.
The right hon. Gentleman asked me various questions about the prime instrument. After the Bill has been enacted, the choice available to consumers will become greater as more sockets are fitted by BT. Consumers will be able to choose whether to buy or rent, and they will be able to buy from whomever they want. I do not see how that can damage our system. Indeed, the measure represents an extension of choice and competition that will benefit the industry.
The right hon. Gentleman asked whether there would be a flood of imports. Since the approvals system was set up 18 months ago there have been about 32 approvals involving 12 companies in relation to telephone hand instruments. The right hon. Gentleman should know that 11 are manufactured entirely in the United Kingdom, that 15 are manufactured substantially in the United Kingdom and that six are modified to be manufactured in the United Kingdom. Therefore, as a result of the policy there will be work for people in the United Kingdom.
The right hon. Gentleman also asked me about Mercury. I shall make a statement by 30 April on the changes on international access for which Mercury has asked and which we shall grant on the international lines. Resale is a very important issue and I shall need time to consider the terms and conditions. However, it is regrettable that the right hon. Gentleman's reaction should be to say that only the public sector and a state monopoly can provide such services. That is just not so. The right hon. Gentleman cannot accept that services can improve as a result of competition and choice. Why should it be the exclusive privilege of BT and its employees to provide such new advanced services? Surely that privilege should be extended to other workers, companies and operations.

Mr. Michael Marshall: Will my hon. Friend accept that his statement is of the greatest importance and that we shall naturally want to study the Littlechild report in detail? At first hearing it would seem that the domestic competition under Littlechild presents the system in this country with a fair and reasonable opportunity to grow and flourish. I declare an interest in Mercury Communications Ltd. Does my hon. Friend accept that international switching is vital if fair and free competition is to be extended into that area as well?

Mr. Baker: I agree with my hon. Friend. For some time—for more than a year—Mercury has been asking for access to switched international services. Professor Littlechild recommends that. I shall make a further statement on that policy within the next three months.

Mr. Geraint Howells: I am sure that the Minister is well aware that those who live in rural areas are very worried about the privatisation of BT. Will the hon. Gentleman give an assurance both to the House and to those who live in rural areas that the service will be kept intact? If the Minister cannot get all the fees required from the access service, what will happen to the rural kiosks?

Mr. Baker: In Committee, the hon. Gentleman's fellow countryman—although not his fellow party member—the hon. Member for Caernarvon (Mr. Wigley), has been very eloquent in representing the views of rural and remote areas. We gave the Committee assurances on


this issue repeatedly last week. There is an obligation on BT plc to provide a universal telephone service. The obligation goes wider than that and extends to telecommunications services. That is not included in the present Act. That obligation will have to be policed not only by BT—as it is now—but by the Director General of Oftel. Indeed, the Secretary of State also has a responsibility to ensure that that universal service is provided.
The hon. Gentleman asked about services in remote and rural areas, but BT is unable to say whether it makes money—such is the state of the allocation of cost accounting within BT. The latest indication from BT is that the remote and rural areas contribute profits to the centre, because the systems are often easier and simpler to run than complicated city systems. To the extent that money may be lost, the access fees will be set at a level that will ensure that BT's social obligations are met. All those with a telephone or telephone service now can be assured that it will continue. Indeed, I refer the hon. Gentleman to the long debates that were held last week in Committee on this issue.

Mr. Michael Grylls: Does my hon. Friend accept that we cannot move too fast to increase competition in the telecommunications industry, and that the more he does the greater consumer choice will be and the more jobs will be created in new firms?

Mr. Baker: I entirely accept that. The speed with which we are moving should be recognised. In four years we have moved significantly to broaden competition from a position in which BT had total dominance in standard setting, equipment approval, equipment supply and the issuing of licences to would-be competitors. That has had a good effect on BT. It is reported on all sides that BT has become much more conscious of its consumers and subscribers and does not take them for granted. That in itself is good, quite apart from the effect on Britain's domestic industry.

Mr. Ian Wrigglesworth: Professor Littlechild's report recommends that BT should be obliged to keep price increases below the retail price index for five years. The Minister has told the House today that the Government accept that approach. Does that mean that BT's prices will not increase by more than the RPI during the next five years, or do some of the Minister's other words mean that is not the case?
Secondly, will the Director-General of Oftel have any say on prices? When will his office be established? What involvement will he have in considerations of this nature?

Mr. Baker: Needless to say, these matters have been well covered in debate upstairs. The appointment of the Director-General of Oftel and the establishment of the office will depend upon the progress of the Bill through the House.
On prices, Professor Littlechild recommends that the Director-General concentrates on the two areas where there will be a virtual monopoly—domestic rentals and domestic tariffs. For most domestic consumers that is the main part of their bill. Prices should be limited to ensure that they do not increase more rapidly than the RPI. They will increase over five years by RPI minus a certain

amount. That means that after privatisation the ordinary telephone subscriber can look forward to his bill going up by less than the rate of inflation. There is a real cost reduction.

Mr. Peter Hordern: Will British Telecom have the sole right to test telephone equipment? Has my hon. Friend's attention been drawn to an article in The Economist, which said that one small firm that wanted to try out a PABX system was to be charged £30,000 for it, in contrast to the American system, where about $1,500 appears to be the charge? What is the position?

Mr. Baker: When the approval system was set up, the only test laboratories were those of BT. It had the only testing engineers and the only test approval systems—and, of course, no standards existed. During the past 18 months, with the assistance of the British Standards Institution, we have commissioned a series of standard writing exercises which have now been approved for much of the telephone apparatus. A separate test laboratory is being set up by the independent board to test the equipment, because it is inappropriate for BT to test equipment from its competitors. We are trying to accelerate that process as much as we can. I ask my hon. Friend to appreciate the fact that one cannot overnight end a monopoly that has lasted for 70 or 80 years. We are moving at a very fast pace, and I want to reach my hon. Friend's objective just as quickly as he does.

Mr. Dafydd Wigley: Will the Minister confirm that paragraph 14.7 of the report suggests three specific modifications to the Bill now in Committee, and that one of them concerns the possibility of funds from the Government to help to relieve the costs of
public call box services, emergency services and services in rural areas"?
As the Government rejected amendments in Committee to that end, will he now say whether the Government are prepared to consider the matter further in the light of this report?

Mr. Baker: The debates that we are likely to reach tomorrow on clause 3(1)(b) will cover both those recommendations and whether there should be an Exchequer subsidy for the social obligations imposed on BT. We believe that the system of access charges, which I briefly sketched this afternoon, will provide a significant and substantial revenue to BT, which will reward BT for the fact that it has extensive local domestic networks. Anyone who wants to plug in to Mercury, Hull, and the radio telephone networks will have to pay that access fee, and the revenues from that will go to meet the social obligations of the call boxes, emergency services, and any other social obligations.

Mr. Timothy Smith: Is it not preposterous that the right hon. Member for Salford, West (Mr. Orme) complains about the length of time that we have spent in Committee on the Telecommunications Bill when he and his right hon. and hon. Friends have been conducting the most outrageous filibuster, and when after 80 hours we have reached only clause 3?
As the main purpose of regulation, according to the Littlechild report, is to protect domestic and small business subscribers against BT's dominant market position, is there not a certain undeniable logic to the local tariff


reduction scheme as proposed by Professor Littlechild? Will not the Government's proposals restrict monopoly, promote competition, and, above all, protect the consumer in a very effective manner?

Mr. Baker: Yes. My hon. Friend has put it very well. Professor Littlechild's proposals, by concentrating on the domestic area, where there is a monopoly, and by imposing a limitation of price there, is concentrating on the area that affects most people, where there is a monopoly, and where BT must not be allowed to charge what it wishes. The corollary, of course, is that there should be competition in the other services, the trunks and international, and competition has already reduced prices there. Trunk rates were cut in 1981 and in 1982. I do not believe that those cuts would have taken place if we had not pursued the policy in telecommunications that we have pursued since 1980.

Several Hon. Members: rose—

Mr. Speaker: Order. If hon. Members are brief, I propose to call those hon. Members who have been rising from the beginning, and then the Front Benches.

Mr. Ken Eastham: As a result of the Minister's statement this afternoon, have any estimates been made in his Department of imports of telephone equipment?

Mr. Baker: The hon. Gentleman is far too pessimistic. If he believes that as a result of competition we shall be flooded by imports, that is a grave reflection on the telecommunications industry in this country. We have a substantial telecommunications industry, but because of the rather cosy relationship between that industry and BT it has not been as forceful and competitive as it could have been. However, during the past 18 months it has responded vigorously. It has introduced new models, which have been competitively priced, and the market is beginning to take off again.

Mr. Richard Page: I congratulate my hon. Friend and his Department on their positive reaction to the Littlechild report. On the matter of opening up the market to international competition, will the negotiations be undertaken by his Department, Oftel, BT, or the companies involved?

Mr. Baker: They will be undertaken by my Department in discussions with BT and Mercury.

Mr. D. N. Campbell-Savours: Despite the fact that the Minister said that there is a weighting in approval, will he assure us that the weighting in terms of imports is the reverse of what he said before? Will he also say what downstream support he is giving to telecommunications equipment producers in the form of sectoral aids, over and above what is already available from the Department of Industry?

Mr. Baker: The answer to the hon. Gentleman's latter question is that the telecommunications operators, the major companies in this country, qualify for general support under our support for innovation. For example—here I speak from memory—they applied for support in the development of fibre optics and optoelectronics. On the question of weighting in favour of domestic manufacturers, because three or four years ago BT had such a grip on the market and the approvals procedures, we had to set up an interim approvals

procedure, which has been regulated by my Department. In that interim approvals procedure we have given precedence wherever possible to those pieces of equipment that either are made or will be made in this country.

Mr. Tim Eggar: I give a particularly warm welcome to the decision to provide increased competition for supply and for BT. Is my hon. Friend satisfied that the provisions relating to price increases and the RPI are right? Is it not possible that BT is already getting too high a return? Is it not further possible that there will be technological changes that will decrease the costs of providing the service? Therefore, should not the Director-General have a right to look at costs as well as to expect increases below the RPI?

Mr. Baker: Yes, indeed. In setting the access fee, the Director-General will have the right to look at costs and be able to make determinations arising from the costs. The lesson of the American experience in the regulation of public utilities and prices and profits has led me and Professor Littlechild to believe that the system in America is breaking down—and has, in effect, broken down—and that the system of cost allocations and of trying to determine which parts are profitable do not work. Professor Littlechild has devised a new, and, in my opinion historically important, method of controlling the price of what, in effect, is a private monopoly.

Mr. Gerry Neale: I join in the congratulations to my hon. Friend. It is because he refuses to close his mind to new reports and comments that he is earning increased respect on the Conservative Benches. Will he nevertheless be alerted by the fact that following three years of sustained argument from the telecommunications industry that there should be greater competition in prime instrument policy and maintenance, he is now likely to come under immediate pressure to try to make the period of phasing shorter and more definite, to ensure that suppliers can offer immediate choice to the consumer?

Mr. Baker: I appreciate my hon. Friend's impatience. I have tried in this whole area to move as quickly as I can. If one can improve on the period of 18 months or two years in relation to the prime instrument and a completion period of within three or four years on maintenance, following discussions with the industry I shall see what can be done.

Mr. Gary Waller: Does my hon. Friend recognise that the more forward-looking managers within BT are anxious that BT should respond to the new challenges and welcome the opportunities presented to them? Is it not regrettable that a great deal of misleading information is being circulated among employees of BT, leading to unjustified fears?

Mr. Baker: I hope that the fears are unjustified. Many people in BT recognise that this is such a rapidly changing and expanding market that they should seize the opportunities. It is no way to seize opportunities to act in a dog in a manger fashion. We are creating opportunities and choice on an unprecedented scale.

Mr. Richard Shepherd: The Littlechild report specifically says that the prevention of excessive profits to shareholders is not a relevant consideration. Is my hon. Friend convinced—I take up the point of my hon. Friend the Member for Enfield, North (Mr. Eggar)—that this is the best way of ensuring the lowest possible prices for consumers, and also that the rate


of return is reasonable and fair? Should not these duties be laid upon the Office of Telecommunications in the Bill rather than peripherally by way of licence?

Mr. Baker: I am asked whether I consider the Littlechild approach is fair in concentrating price limitation on a local tariff index as opposed to a profit ceiling. My hon. Friend will find that Professor Littlechild deals with this matter in detail. He also deals, in paragraph 14.6, with the possibility of having local tariff index control and profit control as well. He concludes that
to impose a profit ceiling on a local tariff reduction scheme is both unnecessary and undesirable.
I appreciate that there will be different views on this aspect of Professor Littlechild's report. I believe that he sets out convincing reasons why we should accept his recommendations. I assure my hon. Friend that the Director-General of Oftel will not have a supine role. He will have a monitoring role. The whole purpose of Oftel, apart from improving the consumer interest, is to monitor the licence.

Mr. Orme: Does the Minister agree, following the exchanges on a very complicated report, which hon. Members have not had a chance to read in detail, that, before proceeding tomorrow morning to deal with clause 3 of the Telecommunications Bill we should have time to study the report? Is he aware that clause 3 is referred to in the report and is central to some of Professor Littlechild's recommendations? Does the Minister agree also that he has never talked about a filibuster upstairs and that when my hon. Friend the Member for Newcastle-under-Lyme (Mr. Golding) made an extensive and well-reasoned speech he congratulated my hon. Friend?

Mr. Baker: I was following the normal courtesies of the House. The right hon. Gentleman has not appreciated the sense of gratitude, expressed in my voice, that a six-hour speech came to an end. I assure the right hon. Gentleman that there will be opportunities tomorrow and in the coming debate on the Bill upstairs to discuss these matters fully. I want them debated fully. I want them debated extensively. We should start tomorrow.

Cross-Channel Electricity Cable

The Under-Secretary of State for Energy (Mr. John Moore): With permission, Mr. Speaker, I wish to make a statement. In connection with the 2,000 MW cross-channel electricity cable project, the Central Electricity Generating Board sought competitive tenders from a number of British shipping firms for the hire of a vessel to lay cables between England and France. The lowest tender was submitted by a British firm, International Transport Management, of Middlesborough, from which the vessel will be chartered. I would emphasise that the cable-laying barge will not be purchased or owned by the CEGB, but by the British firm concerned.
The CEGB must of course be conscious of its obligations to provide electricity as cheaply as possible. As a nationalised industry, it is also conscious of the Government's wish that, wherever possible, it should buy British.
However, when the CEGB received the first tenders for this project some months ago, the price differences were so great it appeared inevitable that the shipbuilding work would go abroad. The board, naturally concerned over this, then asked the firms to tender again, and expressed a clear preference—other things being equal—for vessels supplied by United Kingdom yards.
Regrettably, the second tenders showed such a huge price difference that the board had no choice but to accept the bid from ITM, involving the construction of a vessel in a Korean yard. Other bids to the CEGB, I understand, were at least 50 per cent. higher.
The Government do, of course, provide financial assistance to help United Kingdom shipbuilding firms to gain orders, but even with Government assistance the difference in bids would have been unbridgeable. Hon. Members who have repeatedly stressed the importance to industry and consumers of low-cost electricity will understand this decision.
Questions on the shipbuilding industry, including matters relating to assistance from the shipbuilding intervention fund are, of course, matters for my right hon. Friend the Secretary of State for Industry.

Dr. John Cunningham: I thank the Minister for making the statement. Is it not astonishing, in the middle of the worst slump in shipbuilding this century, that a British publicly financed board should be involved in a contract to spend British taxpayers' money to build a vessel in a Korean shipyard?
I wish to ask the Minister a number of specific questions. Is it correct that ITM at no time invited British Shipbuilders to make a detailed tender for this work? Is it also correct, notwithstanding what the Minister says about the ownership of the vessel, that the CEGB engaged naval architects to draw a detailed and complex specification for this vessel, which was tantamount to meaning that it was designing the vessel for its own particular purposes? Is it also the case that, in terms of the financial arrangements of the deal, the CEGB contribution will be a capital expenditure contribution? Does this not reinforce the point that it is paying for the vessel to be built?
Will the Minister say what the French utilities are doing to fulfil their part of the contract for the cable laying? Will not all their contracts be placed in France? Will he explain


why there is apparently no liaison on this matter between his Department and the Department of Industry, which is responsible for the British shipbuilding industry? Is it not industrial policy lunacy that one public board, spending British people's money, refuses to liaise properly with another public corporation, British Shipbuilders, in its desperate attempts to keep men in work and to sell vessels at home and abroad? Is that not insulting to the management of British Shipbuilders? Is it not a stab in the back for the shipyard workers on Tyneside and Wearside who are staring the dole queue in the face?

Mr. Moore: The truth about liaison between Government Departments is quite the reverse of the hon. Gentleman's suggestion. There was liaison on the charter between British Shipbuilders and the Offshore Supplies Office in my Department. It was advised to pursue the matter through the Department of Industry and its officials communicated with the Department of Industry on this matter in December. The chairman of British Shipbuilders was in contact with the chairman of the CEGB but that was at a much later date, on 14 January.
I am not responsible for the French Government's policies in these matters. It is of interest—I do not have the details but I shall pursue them—that at the moment the French are engaged in chartering a Norwegian vessel for their part of the cable—laying. I believe that that vessel will be converted in the yard at Marseilles.
Negotiations between the CEGB and companies such as ITM were conducted perfectly normally. British Shipbuilders was fully conscious in its approaches via my Department—[Interruption.] I am informed by the CEGB on this matter that British Shipbuilders had the opportunity to make its views heard. Officials of my Department advised it to pursue the matter with its sponsoring Department.
I cannot comment in detail on the CEGB's activities in retaining the services of naval architects but I shall return to the House with more detail. The CEGB sought tenders for the project with a view to owning or chartering because whichever was better for the taxpayer was to the advantage of the CEGB. That would clearly have been a presumption in the tendering process. The CEGB, recognising its obligations to the consumer, again sought tenders to ensure that, if possible, the contracts would go to British shipyards.

Mr. David Steel: Have the Government identified the precise reasons for the variations in tenders from overseas and Britain? If so, what were they? Secondly, did the Government take into account in their calculations not just the possibility of funding through British Shipbuilders but also the higher cost of having more shipyard workers on the dole?

Mr. Moore: I must remind the right hon. Gentleman that detailed matters on the shipbuilding fund and the EC directive are for my right hon. Friend the Secretary of State for Industry. As there is to be a debate on this matter later today, there will be an opportunity for that point to be raised. Everyone is worried about the difficulties of the British shipyards. No one would wish to see orders going to non-British yards, all things being equal. I assume that the right hon. Gentleman is aware of the detailed mechanism under which the EC directive controls the assistance fund. In the tenders that were submitted, assistance was assumed under the intervention fund.

Mr. Anthony Nelson: Is my hon. Friend aware that, although many of my hon. Friends feel that the CEGB has a proper responsibility to seek the most competitive tender, his most serious statement this afternoon gives grounds for great anxiety about whether our policies for British shipbuilding are right? What is the length of the charter involved? If it is other than a short one, it would seem to show that the feasibility of the capital purchase by ITM rests on the financing provided by the CEGB. Therefore, one is essentially talking—although it is done through the medium of a charter—about effectively financing the capital cost of the purchase of a ship.
Does my hon. Friend agree that, although Britain often produces the best ships—the most competitive in terms of cost, and the best suited for the job—it is often finance which ensures that orders go to other countries? Does this case give my hon. Friend or my hon. Friends in the Department of Industry cause for concern?

Mr. Moore: As I said, detailed shipbuilding matters are for my right hon. Friend the Secretary of State for Industry. However, I remind the House that, of the £700 million spent in aid to the shipbuilding industry, over £600 million has been spent while the Government have been in office. I also remind the House that this project will cost the CEGB about £250 million gross. We are talking here about 4 per cent. of the overall contract. Ninety—six per cent. of the business involved is related to United Kingdom purchases. The CEGB spends about £1,290 million a year on goods and plant in the United Kingdom, of which about 95 per cent. is spent on United Kingdom goods and services. Surely that is a record of which we can be proud.
I am advised that the charter will last for between 12 and 18 months.

Mr. Frederick Willey: I share the feelings of the hon. Member for Chichester (Mr. Nelson). Is the Minister aware that the lack of effective consultation and consideration of financial matters overall means that Sunderland Shipbuilders has been savaged and that the heavy redundancies it is now suffering will increase? That is in a town which is already spending £2 million a week on unemployment benefit.
When I raised this matter in Committee last week, the hon. Member for Tynemouth (Mr. Trotter) said that he had been to Korea, a country with the most up-to-date capital facilities, and that shipyard workers there worked 73 hours a week for only a fraction of the wages enjoyed in western countries. In those circumstances, it is suicidal to place orders in such a country. It is about time that we shared the view of the chairman of British Shipbuilders that the ridiculous prices being quoted by Korea are intolerable and that it is time we acted against them.

Mr. Moore: I fully understand the right hon. Gentleman's concern for his constituents. [Interruption.] Despite the interventions from the Opposition Front Bench, I fully sympathise with and understand his anxieties for his constituents and the future of the shipyards in his constituency. However, I must utterly reject the suggestion that British Shipbuilders had insufficient opportunity to enter tenders when the CEGB took the trouble to go out to tender a second time. Any detailed questions on shipbuilding and the relative quality of our yards compared with those overseas should not only


be addressed to my right hon. Friend the Secretary of State for Industry but be raised in a later debate in the House and in the Standing Committee which will meet again tomorrow morning.

Several Hon. Members: rose—

Mr. Speaker: Order. I propose to call the five hon. Members who have been rising to ask questions throughout.

Mr. Tom McNally: Is the Minister aware that the introduction of the idea of keeping down electricity prices will bring a horse laugh from both the domestic consumer and British industry on his Department's record? It is no use the Minister coming to the House, making a statement and then shuffling the responsibility off onto other Departments. Has there been any liaison between his Department and others about the national interest in this decision? Will he read the Official Report of the debate on trade which asked for a vigorous Government policy of public purchasing to help British industry? Has the Minister or any of his right hon. and hon. Friends studied the Korean Government's practices of hidden subsidies and distortions to trade? Is he sure that British shipbuilding is competing on equal terms in such tenders?

Mr. Moore: I know that the hon. Gentleman was not a Member during the previous Labour Government's term of office. Had he been, and had he been able to study electricity prices, he would have seen a far greater percentage increase than has taken place under this Government. He has probably not had the opportunity either to study the Monopolies and Mergers Commission's report for 1981.
The hon. Gentleman may be interested in what the commission stated when it examined the policies of the CEGB:
The board has also pursued a 'Buy British' policy in its procurement of plant; with only small exceptions it has placed its orders with the home industry".
It concluded:
We conclude from the foregoing that the board's procurement costs could have been lower. This arises not from lack of efficiency in use of its existing resources but from concern on its own or the Government's part for the interests of major suppliers".
The interests of the nation have clearly been in the mind of the CEGB, just as they have been in the minds of the Department of Industry and the Department of Energy.

Sir Albert Costain: Is the Minister aware that the converter station for this cable has now been built for more than a year? In view of the rapid progress that has taken place, why has it taken so long to place an order for the ship? In view of the delay, is he satisfied that the ship will be finished on time?

Mr. Moore: My hon. Friend is quite right to draw the attention of the House to the key factor involved in such tenders and contracts—the time and the ability of tenders to show that there is no time delay. That is clearly a crucial part of the contract which relates to the £250 million and not the amount that we are talking about, which is approximately 4 per cent. of the whole contract.

Mr. Don Dixon: Has the hon. Gentleman read the report of the Select Committee on Industry and Trade, which studied British Shipbuilders? Paragraph 43(v) states:
the Government should remind all public authorities of the desirability of buying British materials and components and also ships built in British yards.
Where is the public saving when it costs £5,000 a year to put a British shipbuilding worker on the dole? Is it not about time that the Government gave the same support to our shipbuilding industry as other countries give to theirs?

Mr. Moore: The hon. Gentleman clearly did not listen earlier when I outlined the policies of the Government in terms of their wish that nationalised industries and corporations should, where other things are equal, follow a "buy British" policy. He is also not aware, as I said earlier, how large a percentage of all CEGB contracts are placed in the United Kingdom. He is obviously not aware that, all other things being equal, every effort is and has been made to ensure that, where possible, contracts go to Britain.

Mr. Tim Eggar: Have we not been listening to the most extraordinary doubletalk from the Opposition Benches? Do not Opposition Members, most of the time, complain about raising electricity prices, particularly for industry? Are they not now arguing directly for an increase in electricity prices? Will they get their facts straight for once?

Mr. Moore: My hon. Friend reminded us of the crucial need to ensure economic pricing of our basic fuel products, especially electricity, if we are to ensure that British industry stays competitive.

Mr. Arthur Palmer: Does the hon. Gentleman agree that, in the past, the CEGB has had an excellent record, as it should as a nationalised enterprise, of buying British? In this case, will he tell the House something about the future of this cable ship, because the interconnection between the British and French grids is a one-off job? The CEGB is not likely to have much use for the ship once this job is completed. Will it not have a considerable resale value which could be used to provide a financial arrangement to assist British Shipbuilders?

Mr. Moore: The hon. Gentleman has a large and extensive knowledge of the electricity industry and is very conscious of the way in which the CEGB has tried to carry out this public duty by trying to help British industry. I remind him that the ship is being chartered from British industry. However, the ship will be owned not by the CEGB but by ITM. The CEGB does not own it. The 12 to 18 months for which the vessel is needed had a significant impact on the CEGB decision in terms of analysing tenders to follow that route rather than one of ownership.

Dr. John Cunningham: I assure the Under-Secretary that, although we realise that he is not responsible for shipbuilding, my right hon. Friend the Member for Sunderland, North (Mr. Willey) is correct. No market forces are operating in the shipbuilding sector at present. Is not the CEGB providing the capital for this vessel to be constructed in a Korean yard? Will not the Under-Secretary, even at this late stage, talk to his hon. Friend the Minister of State, Department of Industry and call in


the chairmen of the CEGB and of British Shipbuilders to see whether this order cannot be saved for British industry?

Mr. Moore: We are not talking about the expenditure of money via a public corporation in terms of its specific construction of the vessel. ITM will own the vessel. The CEGB is chartering for an amount under £10 million. The CEGB has advised me that a formal contract now exists with ITM.

BILL PRESENTED

COMMISSION FOR THE NEW TOWNS (ABOLITION)

Mr. Christopher Murphy, supported by Mr. Anthony Steen, Mr. John Wheeler, Mr. Denshore Dover, and Mr. David Gilroy Bevan, presented a Bill to abolish the Commission for the New Towns: And the same was read the First time; and ordered to be read a Second Time upon Friday 11 February and to be printed [Bill 69].

Statutory Instruments, &c.

Mr. Speaker: With the leave of the House, I shall put together the Questions on the four motions relating to draft statutory instruments.

Ordered,
That the draft Export Guarantees (Limit on Sterling Commitments) Order 1983 be referred to a Standing Committee on Statutory Instruments, &amp;c.
That the draft Export Guarantees (Limit on Foreign Currency Commitments) Order 1983 be referred to a Standing Committee on Statutory Instruments, &amp;c.
That the draft Export Guarantees (Extension of Period) (No. 5) Order 1983 be referred to a Standing Committee on Statutory Instruments, &amp;c.
That the draft Export Guarantees (Limit on Overseas Investment Commitments) Order 1983 be referred to a Standing Committee on Statutory Instruments, &amp;c.—[Mr. Archie Hamilton.]

INTERNATIONAL TRANSPORT CONVENTIONS BILL [Lords]

Ordered,
That the International Transport Conventions Bill [Lords] be referred to a Second Reading Committee.—[Mr. Archie Hamilton.]

PLANT VARIETIES BILL [Lords]

Ordered,
That the Plant Varieties Bill [Lords] be referred to a Second Reading Committee.—[Mr. Archie Hamilton.]

Orders of the Day — Consolidated Fund Bill

Order for Second Reading read.

Question, That the Bill be now read a Second time, put forthwith pursuant to Standing Order No. 93A (Consolidated Fund Bills), and agreed to.

Bill accordingly read a Second time.

Question, That the Bill be now read the Third time, put and agreed to.

Bill accordingly read the Third time, and passed.

Orders of the Day — Crime (Social Consequences)

Motion made, and Question proposed, That this House do now adjourn.—[Mr. Archie Hamilton.]

Mr. George Cunningham: The new procedure on the Consolidated Fund Bill gives freedom to discuss issues in more general terms, and is less artificially restrictive than the old procedure. My colleagues and I in the Social Democratic Party decided that it would be useful to devote some time to a discussion of the increasingly worrying problem of the intensifying prevalence of crime on our streets and in our housing estates, especially in the inner cities. The most worrying feature is that it is getting worse, and the residents of those areas ask themselves, "Where will it all end?"
There are classes of crimes. It is important to recognise that I am talking about what some people might call "petty crime", although it is better defined as that class of crime that excludes major organised activities such as drugs rings and train robberies.
The term "petty crime" is not a correct description, because muggings in the street and robberies in houses impinge most immediately and most severely on the quality of life of our people. If train robbers manage to walk off with £1 million, that is a terrible thing, but that does not affect the immediate lives of many people. The subjects that I am talking about in this debate affect many people. I am talking of muggings, thefts in the street, burglaries and vandalism.
These days, hundreds of thousands of people live in constant fear. They fear that a knock on the door after dark will be a knock not from a friendly neighbour but from somebody who, once the door is open a fraction, will bash his way in to mug and rob. They fear that, when coming back from the Post Office after picking up their pension, if they are lucky they may not be injured when robbed, but if they are unlucky, they May be robbed and injured. They fear that their windows will be smashed by petty acts of wanton vandalism. They fear that the appalling attacks on usually elderly people by very young boys and girls—evidence of which they have seen in the newspapers and on television—will happen to them. On many of our housing estates, caretakers fear that they will be attacked, whereas in days gone by they were able to control some of the anti-social behaviour of youths.
Several months ago, I visited a housing estate in South London. A resident showed me the inside of his front door. There was the usual array of bolts and chains, but the


chains were of a strength that would allow a vehicle to be towed along the road. They were fastened to enormous clamps to the walls and the door—on both sides in case the attacker took out the hinges.
When I was shown this Fort Knox type of prevention, I concluded that that resident must have exaggerated the danger. His next door neighbour showed me the inside of his door, which was festooned with a similar array of protective devices, including two electric bells which, when switched on, were designed to ring sirens inside the flat, in the hope that if something happened, help would come.
That happened, characteristically, on the first floor of a tower block—a location that is particularly subject to this kind of crime. The fear that exists among these people did not exist to anything remotely like the same extent even 20 years ago. I am not suggesting that, compared with the historic past, the level of crime is worse today. Of course it is not, if we go back to 150 years ago, when it was much worse. However, in this century, we now have a level of such crime that is wholly unprecedented and is getting worse. That justifies the House and the Government taking a co-ordinated look at the subject instead of looking at it piecemeal.
Younger and younger youths are taking part in such attacks. Far more girls are now participating in this kind of behaviour than in the past. Many parents are completely unable to control their offspring. In other words, there is an underlying table of this kind of relatively petty crime. That is not only bad in itself, but that pool of crime is the pool from which lifelong major criminals are recruited.
Attitudes and tolerance of crime in what people say is part of the contributory cause. There is too much tolerance of petty crime. I am not talking about penalties but about what people say. There is too much tolerance of anti-social tenants on housing estates. There is an attitude of mind that we should not be too hard particularly, if there are children in the family. Many councils, including the Islington borough council, do not take sufficiently into account the fact that if mildly bad social behaviour is tolerated, other people will imitate it. As a result, we create more anti-social behaviour among people who would otherwise behave properly if we do not come down fairly hard against those who break tenancy conditions.
At the time of the disturbances in Brixton and Bristol, much of the comment was, if not designed, at least calculated to have the effect in the minds of those who took part in the disturbances that the cause was not in themselves but in something in society. I take an old-fashioned view which, nevertheless, is right. If a person mugs someone else, breaks a window or throws a firebomb, that is not the fault of the victim. It is not the fault of the parents of the offender. It is not my fault, nor is it the fault of society. It is the fault of the person who commits the offence. I realise that that is an unfashionable view, but if we could move back towards that attitude, we might cease creating in the mind of the offender, and sustaining in the minds of potential offenders, attitudes that are hostile to the termination of this kind of behaviour.
It goes without saying, and it should normally go without being said, that a large pool of unemployment will lead to more crime, but the unemployment does not justify the crime. It goes without saying that if there is racial prejudice against black youths—and there is—that will

result in more crime, but it does not justify the crime. We must first recognise the severity of the problem and the fact that it is getting worse. We must realise that in this sphere it is difficult to achieve anything, but it will at least be easier to stem the trend than to reverse it if it goes even further than it has at present.
Let us compare the United States and Britain. Visitors from the United States frequently express their admiration and envy of the relative peacefulness of British streets. It will be easier to prevent ourselves going as far as the Americans have gone than to reach the condition that the Americans are now in and then to try to scramble back to where we are now. Violence in schools is an example. We in Britain have very little violence within schools, certainly compared with the United States, but over the last three or four months, there have been many stories on this subject. The likelihood is that if present trends continue a larger number of teachers will be afraid of being attacked in the classroom or on the school premises.
If that becomes established, it will be difficult to reverse. Better that we stop, pause, look at the matter and consider what we can do to prevent that further trend than to let it happen and then try to reverse it.
What we do about it is more difficult. The first stage is to diagnose accurately what is wrong. The police are in the front line in the prevention of this kind of behaviour. Too often—all too often in this House—there are two groups of people. There are those who attack the police for transgressions and who say very little on the other side of the argument, and those who invariably support the police and believe that we should do so if only to balance the unbalanced attitude of the others.
It is obvious to everyone outside that there must be a two-handed approach to the police. They are on our side against the criminals, but when the police—given the strength that a police force now has in modern society—transgresses we must come down on it like a ton of bricks, all the more so because of the special position it occupies.
The present strategies of the police for the control of crime are no ideally suited to the kind of crime I have been talking about. The strategies are well directed towards large-scale organised crime and to some of the more melodramatic forms of crime. Street crime, petty burglaries and so on are a much more difficult problem and present police strategy is not directed towards it. It is good that the new Commissioner of Police of the Metropolis recognises that in his provisional strategy plan. He has taken some steps and intends to take more, to shift the emphasis from the activities with which the police have normally been concerned towards the forms of crime that I have mentioned.
A lot of rubbish is talked about so-called community policing. Those words ought to be banned. They are a substitute for thought rather than an aid to thought. We need more home beat officers, and more home beat officers who stay on a beat for longer. We need more of what, in London, were called for a time protected home beat officers. They are home beat officers who are not removed from their beat to look after a football match or a demonstration.
However, a handful of protected home beat officers could not solve the problem. We need more contact between the local police and organisations such as tenant's associations, schools and social clubs. We need to eradicate the last traces of the reluctance of the police to


patrol private estates, including council estates. There are some problems, but they can usually be overcome if the council and the residents are willing to receive the police into those estates. About two thirds of my constituents are council tenants. I have never encountered one who was reluctant to see the police patrolling the estates, although I have encountered many who complained that there was not enough patrolling of council estates by the police. At one time we were daft enough to build our streets up into the air instead of along the ground. Those who live in the vertical streets called tower blocks should not receive less policing than those who live in normal horizontal streets.
On police numbers, I have knowledge only of the Metropolitan police. It is time to review the numbers of that force. In the past few years there has been a significant increase in the strength of the force. The Commissioner himself has recently shown, however, that those additional numbers have gone into central functions and not into patrolling. The number of policemen on the streets has scarcely increased.
There has also been an increase in the number of police who are distracted from such work to do other work, some of which is not police work. I give an illustration from my borough. In Highbury Corner magistrates court there are cells which have to be used for Home Office prisoners. Those prisoners have been before the court and are remanded in custody. In the normal way they would be held in prison, but, because the Prison Officers' Association refuses to take them into prisons, they have to be farmed out all over London and held in one police station or another or, more usually, in one court building or another. In Islington, three sergeants and more than a dozen police constables per day are used exclusively as gaolers for Home Office prisoners. That is not police work, and it is a massive drain on resources. What does the Home Office intend to do about it? It has already been going on for about three years and it cannot continue. We need the police to do police work, not prison warders' work.

Mr. John Wells: I am loth to stop the hon. Gentleman at such an interesting point in his speech. He said that the police have been used in this way for about three years. Have the numbers increased? In other words, is the situation becoming worse or has it remained static?

Mr. Cunningham: I am not sure that it can get worse in any particular district. At Highbury Corner, for instance, only a limited number of cells are available for that purpose, and I imagine that the number of police required is roughly the same whether the cells are being fully used or not. I do not know whether there has been an increase in the number of court buildings being used as temporary prisons, but my impression is that for the past three years a fluctuating number of unaccommodatable remand prisoners have had to be accommodated in that way.
It is argued that the solution to that problem is to send fewer people to prison for shorter periods and I agree entirely that that is a desirable end. In considering why people are sent to prison when we think that they should not be, or go to prison for longer periods than we believe to be right, however, the position is more difficult. Some people, particularly in the Labour party, have the bright notion that a half remission of sentence would solve the problem, but that would create an even greater gulf

between what the penal system appears to be doing and what is actually done. For that reason, I am against that view. On the whole, if one says that a person is to be sent to prison for two years that is what the sentence should mean. There should be some possibility of remission, but a two-year sentence should not mean only about eight months in prison.
In this respect, we are too critical of judges and magistrates and we are unfair to them in not providing alternatives. The number of people sent to prison as a percentage of the number of offenders is in fact lower than in the past. It is a smaller percentage of a larger number of offenders. That is the first thing to be said in defence of the benches. Moreover, judges and especially magistrates do not have sufficient bail hostels available. There is also insufficient accommodation for alcoholics and similar offenders to avoid the need to accommodate them in prisons.
The feature of our penal policy to which I especially wish to draw the Minister's attention is what I regard as the serious gap in the spectrum of penalties and treatments available. Judges and magistrates frequently send people to prison because they feel that the most severe non-custodial sentences available are not severe enough. Prison involves complete supervision 24 hours per day and seven days per week, but if the offender does not quite warrant that treatment there is virtually no supervision.
There are community service orders and the facilities of the probation service where they apply. However, there is an enormous gap between any of the non-custodial sentences and the least severe of the custodial sentences. That has happenened because we approach the problem piecemeal. We invent community service orders and we invent other things, but we never look at the whole issue and endeavour to provide a total quiverful—a total spectrum—of penalties from the slight to the severe. Especially, we have never given our attention to how one manages to make fines and other financial penalties work. In other words, how do we get the money from the person against whom the penalty has been awarded?
We need to think of prison for some offenders—especially the offender about whom I am speaking—as a first step in a more prolonged period of supervision. If we had a good penal policy, there would be some people for whom a very short period in prison was no more than a reception into intensive care, which then tailed off into less intensive care outside prison. We do not remotely have the attitude of mind, nor do we have the facilities, to do that. Our prisons are not suited for that. That is one reason why the Home Office must maintain its prison building programme. That is not to say that, instead of 40,000 in prison, we want 80,000 in prison. It is in part to say that we want them not in the present old-fashioned prisons, but in prisons where there can be treatment of the kind that I am suggesting. Therefore, we should go for a more intensive form of supervision outside prison in the community.
There, we hit a problem. With great affection for and respect to the probation service, we must remember that it grew out of the prisoner's friend movement—a role that it believes it should continue to play. It is resistant to the notion of the probation officer being the warder in the community, yet that is exactly what we need—warders in the community who can supervise those outside prison to a greater or lesser degree, according to the circumstances.
That is the aspect of our penal policy about which I hope the Home Office will start to think. It is very difficult for the Home Office because we do not have a proper Department of State looking after that area. The Lord Chancellor's office is partly responsible, as are the Attorney-General, the Director of Public Prosecutions and the dear old Home Office. For practical purposes—and we understand that—the Home Office divides responsibility for those spheres between two different Ministers, and we all know that that creates a problem.
There is no one to pull the whole thing together. I am asking the Home Secretary, as the most obvious Minister, to try to pull it all together, especially with regard to penal policy, and that he should try to secure that complete spectrum of penalties that will be more likely to fit the needs.
We need to find ways to apply fines and have them collected. That may mean that some form of custody—not necessarily prison—should have a measurement in money terms so that a person earns the money to pay the fine or to pay compensation, according to the number of days that he spends in custody.
We have a final difficulty, which is the vitiation of the subject by the attitudes of the two main parties. At the moment, the Conservative party attitudes are perhaps the less serious. We are all familiar with the hanging and flogging brigade in the Conservative party. However, a new ingredient in our political scene is the party attitude that people in the Labour party, who should know better, find themselves obliged to adopt. They feel that they must pay at least lip service to the dominant trends within the Labour party.
That is relevant to the business of the control of the police. If the police are to adopt the type of community work to which I have referred, they must have close relations with local authorities. In London and in some other areas at least, that is made extremely difficult for the police while the Labour party argues that county authorities should be in a position to control the police.
The whole business of the post-Scarman links between the police, the local authorities and the community in London is vitiated by the dominance of the Livingstone attitude to the relationship between the police and local authorities. What should happen is terribly obvious. Outside London, local authorities do not control the police. In theory they do to a certain extent, but in practice they do not. When the trouble in Bristol occurred, no one went running to the police authority for that area to say that it must do this or that. They went running to the Home Secretary. When the Northamptonshire police were vetting juries, contrary to the guidelines issued by the Attorney-General and the Home Secretary, nobody went running to the police authority and asked it to correct the problem. They went to the Home Secretary and, with a bit of huffing and puffing in excess of his legal powers, he fixed the chief constable for Northamptonshire. I am glad that he did. That is right.
The police in modern society are too powerful, and the issue is too important, for control to be in the hands of county councils. County councillors do not have the necessary clout. Moreover, if control—in so far as control is in order at all—is in the hands of county councillors, plastic bullets will be permissible in one part of the country, but not in another. There will be one area in

which the police will go the whole hog on pornography and another where they will concentrate on petty burglary. That is preposterous.
We need to have a co-ordinated effort and co-ordinated criteria on a national level. We should, therefore, look to control of the police by the Home Secretary and the Home Office, where it will be carried out in a politically restrained manner. That is political not in the bad sense. but in the good sense that it is democratic control. The advice tendered to the Home Secretary will be decent and professional. We do not think all of the time that the advice given to the Home Office is decent and professional, but it is a lot better than the advice tendered by the latest chap recruited by an advertisement in The Guardian by the GLC police committee. Therefore, we should have control of the police by national Government, in so far as there is control at all, and we should have consultation at local level. If one does that elsewhere, it can be done in London also. A common system should apply to the whole country, no doubt with some amendments on the consultation system according to the nature of the area.

Mr. Tom McNally: I am sorry to interrupt my hon. Friend's fine speech. Does he think that the political balance would be enhanced if individual chief constables saw themselves much more as civil servants rather than as political and media figures? There is a need to get the balance right on that side of the equation also.

Mr. Cunningham: I understand my hon. Friend's difficulties and views on that. Chief constables should see themselves not as television personalities and the like but as statutory figures who are responsible to the courts and, to some extent, to the Home Secretary for their activities. If they were not wholly independent in law of any control such as that, chief constables would revert to their previous behaviour and, some of them would stop behaving as prima donnas.
This sensible development, by which the police could be controlled in consultation with the police, is vitiated by the attitude of the Labour party. The most serious thing about some of the remarks from the Labour party on this subject is not that their spokesmen think that it would be a good idea to hand the Metropolitan police over to Mr. Livingstone. It is much more serious than that. It is that they do not think that it would be sensible to hand it over to Mr. Livingstone, but they feel obliged to say that it would be. That is the nature of the Labour party at the moment. It is no good kidding ourselves. In London, the most important part of this problem—the whole business of tackling crime—is now vitiated by the present attitudes of the Labour party.
To sum up, we have a serious problem. It is getting worse. If we do not stem the prevalence of crime now it will be harder to correct it in future. Present priorities in policing strategy are not directed at that. There is a gap in our range of penal weapons which must now be filled for this type of crime. The Social Democratic party exists to bring common sense to British politics. I suggest that this type of diagnosis and these prescriptions are so common sense that they are obvious to members of the public who do not spend all their time in political meetings. They do not appear to be obvious to the Conservative party, and they are certainly not obvious to the Labour party in its present condition. I hope that the Minister has listened to what I have said and will move in that direction.

Several Hon. Members: rose—

Mr. Deputy Speaker (Mr. Paul Dean): Order. I remind the House that this series of debates is taking place under the new procedure for the Consolidated Fund Bill. The effect is that most debates, including this one, are limited to one and a half hours. That means that this debate must finish by 5.56 pm.

Mr. John Wells: The whole House has enjoyed the excellent, intelligent, charming and enjoyable speech of the hon. Member for Islington, South and Finsbury (Mr. Cunningham), but it was marred by two deplorable sentences at the end. Until he got to that little spoil it was admirable stuff.
I should like to make four points briefly. First, the hon. Member for Islington, South and Finsbury touched on violence in schools. I wish to examine another aspect of school life, or non-life, and that is the sharp growth in truancy. The hon. Gentleman rightly said that people—he implied that hon. Members were among them—are too critical of judges, and magistrates, sentencing policy. I agree. I shall criticise magistrates and education authorities for a moment for being dilatory in their pursuit of truants and their parents. A sharper and tougher attitude to truants would instil a better attitude to petty crime at an early age.
Secondly, we are guilty parties in that we churn out Bill after Bill, whether it be on seat belts or something else, which brings the law into disrepute. I am ashamed to say that I have not worn a seat belt much in my life. I do not think that that is clever and I am rather ashamed of it. I do not want to break the law and I do my best to wear one. I am a law-abiding citizen, but sooner or later it is inevitable that I shall forget to wear my seat belt. I shall remain a law-abiding citizen and I shall not regard myself as a miserable sinner. I shall have to apologise to the police officer who will catch me in the crime that I shall inevitably commit but do not wish to perpetrate. The same will probably happen to most other hon. Members. It is an example of bad legislation. There is too much of it.
The House and its agencies should promote attitudes on subjects such as seat belt wearing rather than produce nanny legislation. I know that the medical profession and doctors made a good case for the seat belt legislation. I hear what they say, and I try to conform with it, but we should not make laws that are difficult to enforce and make things that most people do not consider as terrible sins into a crime.
I shall now make a fairly parochial point. I am delighted that my hon. and learned Friend the Minister of State, who shares the garden of England with me with regard to our constituencies, is to reply to the debate. Some people may say that the gipsy problem is insoluble and of no interest to hon. Members from many other parts of the United Kingdom, but it is a real problem.
I remind my hon. and learned Friend of the clergyman in the borders in the 1890s, who was the incumbent of a parish called Kirk Yetholm. He was a tough, autocratic old chap in the way that clergymen could be then. He impounded all the gipsy children and sent them to a school. Their parents could roam around the countryside, but the children were corralled into a boarding school. That may be considered autocratic, high-handed and unacceptable nowadays—and I agree that it is—but unless we can break the vicious circle of gipsy children not

attending schools and breeding, I am afraid frequently below the age of consent, they will perpetuate the cycle of non-school attenders and petty criminals.
All too often, offenders, not only gipsies but other modest offenders who are broke, are fined. The fine is then paid by the social security system. You, Mr. Deputy Speaker, and I, the Minister and the shadow Minister and the rest of us pay the fine. That is absurd. We are also called upon to pay court costs and so on. We must pay close attention to what the hon. Member for Islington, South and Finsbury said about the need for something that is unpleasant but short of a custodial sentence.

Dr. Shirley Summerskill: The hon. Member for Islington, South and Finsbury (Mr. Cunningham) has raised an extremely important subject that deserves careful attention from anyone who is worried about the serious rise in crime. The Social Democratic party policy on law and order has been unveiled, but we do not know whether the Liberal party agrees with it and whether there is a true alliance. No doubt the Liberal party will be present at some future debate and we shall hear then whether the two policies are allied.
As for the Conservative party, there is no evidence to suggest that it has any justification for claiming to be the party of law and order. Under the present Government, burglary and crimes of violence have increased, the detection rate has decreased and the conditions that provide fertile ground for criminal behaviour have flourished. There have been cuts in local authority funds for housing, cuts in social and community services, and cuts in opportunities for training and further education. The cuts will create the environments in which criminal behaviour is most likely to be found.
Homelessness among young people is increasing rapidly. There is clear evidence that that group of people are especially vulnerable to delinquency and that those who leave institutions and have nowhere to live are more likely to commit offences. Yet there is no statutory agency with responsibility to provide for these young people.

Mr. George Cunningham: What does that extraordinary phrase "vulnerable to delinquency" mean? Does the hon. Lady mean that they do it?

Dr. Summerskill: As I shall show in a few minutes, I mean that certain conditions, if they are not the reason for crime, certainly tend to encourage crime.
The most destructive of all the problems is unemployment. Here, the hon. Gentleman will be in agreement with what I shall say. About 52 per cent. of all young people between the ages of 16 and 18 and on the labour market are without work. Unemployment usually leads to monotony, idleness, frustration, family tensions and low income. Therefore, those people have little to lose by committing crime. The chairman of the chief probation officers, Mr. Michael Day, said that
the connection between crime and unemployment is beyond any doubt.
As the hon. Gentleman said, unemployment is not an excuse or justification for crime, but an explanation for it. The Prime Minister has asserted that there is little or no connection. She said that at the time of the Brixton riots. However, the Home Secretary has wisely agreed that there is. In a much-quoted speech in the House he said:
There has been a dramatic rise in unemployment among boys and girls. That is the responsibility of this Government Let no


one have any doubt about the danger that that has created in terms of crime of all sorts, violence and vandalism."—[Official Report, 27 February 1978; Vol. 945, c. 40.]
The Home Secretary appreciated the clear link between unemployment and crime. Those people get caught up in a vicious circle. Unemployment can lead to criminal activity, and a record of criminal activity can lead to long-term unemployment.
One of the most difficult but essential tasks of the probation officer is to find a job for the person in his charge, which will help to keep him or her from committing further crimes. About 50 per cent. of men imprisoned for over three months commit a serious offence within two years of their discharge. If there is no job available, it is essential that such people should be found some sort of occupation, whether it is a training scheme, a day centre or evening and weekend supervision. Therefore, the role of the probation officer today is more important that it has ever been. The probation service deserves all the support that it can get in the form of finance, and man and woman power. I emphasised that during the passage of the Criminal Justice Bill.
The victims of the increase in crime, especially violent crime, are often the elderly, women, low-income families, members of ethnic minorities and vulnerable groups such as transport workers. The effects of crime spread to all those who fear that they will become a victim, when their neighbour or relative has become a victim. They are frightened, not only in the streets, but even in their own homes.
In our preoccupation with finding ways to reduce the crime rate we must not neglect to help its victims, and we must continue to examine ways in which the offender can be required to make reparation for an offence direct to the victim, in the form of money or community service. Perhaps the Minister will say whether the Government have any plans for encouraging victim support schemes.
A more efficient and effective police force is one of the keys to reducing the crime rate. I say "efficient and effective" because I know that the Minister will say, rightly, that the numbers of police have increased. That is all to the good, but it is essential that as well as there being adequate numbers, the police who are in operation should be effective and efficient. Everyone would like to see more police on foot patrol. For the whole town of Halifax—my constituency—the maximum number of policemen on foot patrol in any part of the day is 12. There are only 12 policemen on foot patrol between 6 pm and midnight. That seems to be an inadequate number for a large industrial town with a closely confined population. We would like to see a reduction in the size of police authority areas and a reduction in the incidence of crime through a higher rate of detection, because the greatest deterrent is the fear of being caught.
The control of crime is a social and community problem. Therefore, it should be of concern to every local authority and Government Department, not just the Home Office. Every Government Department such as Environment and Education and Science, should analyse how its duties and responsibilities relate to crime. The control of crime should be the responsibility of every television programme maker, every teacher, every parent and every citizen. Criminals are influenced by the environment in which they live. That is where crime starts.

Ordinary members of the public must become far more vigilant, observant and suspicious and not simply mind their own business. They should be on the lookout for potential crime and report to the police if necessary.
There is no evidence that long prison sentences or short, sharp shocks reduce crime or prevent recidivism. It is clear that it is a job not only for the Home Office, the police, the courts and the prisons to tackle crime, but for the whole community to do so. This debate might help to inspire every member of the public to be a crime prevention officer in his daily life.

Mr. Peter Bottomley: The hon. Member for Islington, South and Finsbury (Mr. Cunningham) has done the House and and the country a service by choosing this subject in this new-style Consolidated Fund Adjournment debate. I hope that during the next year, probably after the election, it will be possible to have a fuller debate on the Adjournment so that we can bring out ideas and try to hold Ministers to account on the limited things that the Government can do to help to reduce both the amount and the impact of crime and to search for more effective punishments and deterrents for those who are caught.
One of the problems, as was shown in the introductory remarks of the hon. Member for Halifax (Dr. Summerskill), is the great temptation to drag in irrelevant party political issues. There are some relevant issues. I agree with the comments of the hon. Member for Islington, South and Finsbury about partisan stereotypes. However, the fact remains that even when the hon. Gentleman was a member of the Labour party he talked the same amount of common sense. I hope that, while I remain a member of the Conservative party, which I suspect will be a long time, I shall do the same thing.
Much as I admire what my hon. Friend the Member for Maidstone (Mr. Wells) says in other parts of the building, I thought that what he said about seat belts was tosh.
We have learnt a great deal about what is associated with crime. I shall not go along the simple lines that we have just heard. Harriet Wilson carried out studies in Birmingham of what family behaviour tends to be associated with crime. Among families of the same social class and circumstances, it may occur because of different child behaviour and most of all because of different parental behaviour—for example, some parents do not chaperone their younger children. It is as plain as a pikestaff. That is well known among those who give evidence, yet it is not shouted from the rooftops and it is not part of common wisdom in every locality.
We know that most schools and police authorities are aware of the incidence of different types of crime and what numbers of crimes there are for each school, parish and so on. The figures should be published year by year so that people can identify with them locally and work towards improving them. It might be a matter of providing more distractions for children, or by bringing back some "old-fashioned informal control"—I use an expression that Sir Kenneth Newman used at an all-party meeting at the House a month ago.
I believe that two or three other matters are also essential. First, I suggest a review of our magisterial system. It is all very well having as juvenile magistrates the best people that can be found in an area, but there is no substitute, on an estate of 2,000 people or more, for


having people from that estate reviewing the behaviour of local people. I know there are problems with so-called people's courts, but people who live among the failures and the crime and who see the opportunities for improvement locally, bring more common sense to the problem than outsiders who come in to dispense justice. Justice could be more immediate, if more informal, and could achieve social disapproval as well as approval within a locality.
It is essential also to learn from the kind of work sponsored by the Church of England Children's Society for the past few years. I declare an association with that society. I should like to mention Bob Holman and his work, which has been published in part in "Kids at the Door". There is also a tracking scheme, which provides chaperonage by probation officers and similar bodies in addition to families. It is a scheme which tries to control those children who are at risk of committing crime. They have to report many times during the day. It reduces the time available during which a child can go missing.
The most important way to reduce crime is to make people aware that they have something to lose when they are found out and also to increase the risk of detection. There are too many people who feel that they have nothing to lose. Too few parents are aware of the impact that slipping into truancy, petty vandalism and more serious crime as they move up the ladder of criminality can have on a child's life. I believe that more people will accept their responsibilities and recognise the influence that they can have on young people when they realise how serious it is for the child, and also that such behaviour is too dangerous for society to tolerate.
I have been associated for some time with Family Forum. It is an organisation which brings together a large number of voluntary bodies which are trying to bring the family perspective into social and economic policy.
I believe that the Home Office should give serious consideration to working with the various voluntary bodies, not just in the area of crime and police, but to see what can be done, possibly with a pilot scheme, to make more parents aware of their potential effectiveness in bringing up their children. I shall not go into issues of morality, values and standards and the fact that people can make such choices for themselves, because I believe that the Minister can do that. I want to emphasise that there is potentially an enormous alliance between those who will benefit from getting crime under control.
Although the hon. Member for Halifax says that increased unemployment is associated with a rise in juvenile crime, and that is statistically correct, it is also correct to say that the incidence of crime per 100,000 people rose more dramatically when this country's standard of living was rising more dramatically. For example, if there are more car radios to steal, more get stolen.
We could reduce the amount of juvenile crime year by year if we started taking the right action. It is how we do things that matters. Perhaps the Minister could at some stage estimate the savings to the community of a reduction in juvenile crime of 10 per cent. a year for five years instead of the increase of 5 per cent. a year that we have had for many years. Will he, perhaps, consider making an extrapolation—not a forecast—of the reduction in crime if crime were to reduce at the same rate as the reduction in numbers of adolescent boys? We know we are moving towards having fewer teenage boys. That reduction should

be associated with a reduction in juvenile crime. What can we look forward to if there is in fact an association between the number of teenage boys and the amount of crime? We must then see what we must do to ensure that that reduction occurs.
Enormous benefits can be gained by having a more effective policy. Hon. Members cannot detail all the action that needs to be taken. We should worry away at the Government to persuade them to do the limited things that they can do. We should also draw the problem to the attention of the public to show them that we are more worried about it than we are about new control of the police. We need more control of ourselves and we need to control our children more effectively. If we could achieve that we could pat ourselves on the back and vote ourselves a pay increase.

Mr. Ian Wrigglesworth: I congratulate my hon. Friend the Member for Islington, South and Finsbury (Mr. Cunningham) on introducing the debate and raising a most important topic and one about which many people are anxious and upset, particularly in inner city areas. I congratulate him also on his speech, which contained a useful and perceptive analysis of the problem and some good suggestions of how it could be tackled.
I disagree slightly with one thing that he said, but I believe that his comments generally hit the nail on the head. I hope that they will be marked and understood by a great many people in Government and outside.
I agree with much that the hon. Member for Woolwich, West (Mr. Bottomley) said. There has been plenty of research and evidence into the kernel of the problem that we face. However, before I discuss that I want to deal with his comments on the political problem posed by this subject. The House must face the change to which my hon. Friend the Member for Islington, South and Finsbury referred which has taken place recently in what has effectively been a bipartisan approach to the administration of the police. I refer to developments that have been taking place within the Labour party and its proposals, which I understand have now been adopted by the Front Bench, for substantial changes in police administration. In my view, and that of my right hon. and hon. Friends it would lead to the most damaging politicisation of the police.
I hope that wiser counsels will prevail within the Labour party and that the proposals that are being pressed by Mr. Livingstone and those associated with him will not become the Labour party's nationally adopted policy. If they do, I believe that we shall see increased political interference with the running of the police as well as increased accountability to elected representatives. It could have consequences more disastrous than any we have had to contemplate before.
The hon. Member for Woolwich, West referred to the core of the problem that gives rise to crime. During the next few weeks, we shall hear that serious crimes in Britain have risen for the first time above 3 million, as have the unemployment figures. Mugging, burglary and vandalism—crimes that affect people's lives—are increasing and have not been deflected by the policies that have been pursued in recent times. If we are to succeed in reversing the trends, we must go to the core of the problem. Essentially, that means tackling people's


attitudes and values and changing public standards and perception. The House has an important role to play in doing that, as do all politicians.
One cause of the decline in public standards has been the behaviour and the utterances of some politicians, not only in Britain but in other countries, during the past two decades. The bear garden that the public hears in the House from time to time does not help to mould public standards and values in the way that hon. Members would wish. It is a terrible influence upon young people to hear hon. Members, and Ministers, shouting and bellowing at each other in such a disreputable way. I hope that the House will soon agree to allow television cameras to record our proceedings, so that the public can see what is going on. That will help them to understand a little better, and it may make some hon. Members who are the cause of some of the noise rather more responsible and responsive to public opinion.
The hon. Member for Woolwich, West mentioned the research that has been carried out into deprived families and families who live in poor circumstances, and the circle of deprivation, as it has been called, from which crime seems to grow. I agree with my hon. Friend the Member for Islington, South and Finsbury that those circumstances do not excuse the commission of irresponsible and illegal acts, but any one with experience in schools or social agencies can identify those areas and families in which there will almost certainly be crime.
In many of the inner urban areas where such crimes are committed we must introduce policies that will bring about a greater sense of responsibility within the community in which those families live that can be achieved only by decentralising some of the administration and some of the policies that are pursued to a much more local level. I am sure that one reason why people commit the crimes about which the public are so worried is that the community in which they live does not impress upon the individual any sense of responsibility to the community. Many large housing estates are administered remotely. Many facilities and properties apparently do not belong to anyone. There is no sense of belonging to the community.
For about one year, I used a waiting room in a south London railway station. It was much vandalised, but a student at a local art college painted one wall and put up a notice to explain what he was trying to achieve. The painting made the waiting room a personal place, and I was interested to note that there was no graffiti on that wall because one had the feeling that the wall belonged to someone and that it had some character. It was no longer the dirty, impersonal waiting room in which one used to sit. There is an important message in that. If there is a sense of responsibility in communities, where the people care and deplore acts of violence, we can make some progress in reducing acts of crime. All of us in public life, including Ministers, have a responsibility to try to bring that about.
After the experience of the past few years, it is clear that the penal system and the police can play only a limited role in reducing crime. Of course we cannot ignore the penal system or the police. I and my colleagues wish to see the strength of the police maintained and the number of police officers increased, and we do not wish to weaken the role

that they play. But, at the end of the day, they will not stop the increase in crime. The community is the only body that can do that.
Recently I visited Japan, where there is a strong sense of community, and I was very interested to note the low incidence of the crimes about which most people in the House and in Britain are worried. One never saw chains fastening radios to the shelves in Japanese electrical shops. That would be almost unthinkable to the Japanese, because public, personal and community standards there are so different. We must try to achieve those standards in Britain.
My hon. Friend made several suggestions about how we might improve the penal system and the police service. My one slight worry about his comments was on the changing role of police administration. I would not go down the road—I am not sure that my hon. Friend suggested it—of having a national police force. However, there must be co-ordination of police activities and we must face up to the modern reality that that will be increasingly necessary. However, if we could change the voting system in local authority elections, we would probably have very different local authorities with less partisan to-ing and fro-ing. It would make local authorities more acceptable. Police authorities have many powers, but very few of them are exercised. If people are worried about the way in which the police are controlled, police authorities as at present constituted have many powers, although they are not used now.
I refute the recent suggestion of the Home Secretary at Question Time that when my right hon. Friend the Member for Glasgow, Hillhead (Mr. Jenkins) was Home Secretary, there was a reduction in the police force. During my right hon. Friend's term of office, police numbers increased more greatly and faster than under any Home Secretary for the past 30 years. It is palpably untrue to suggest that the reverse is the case. My hon. Friends and I firmly believe that there is a need to sustain the numbers of the police and, indeed, to increase them so that they can carry out the type of activities to which my hon. Friend referred.
We are facing a most serious crisis with crimes rising almost certainly during the current period over the 3 million a year figure. I hope that we shall hear from the Minister some suggestions as to how we might improve not only the effectiveness of the penal system and the police service, but also some suggestions and some words that might help to change public values and community standards so that we may all see being brought about the reverse of the trend of recent years.

The Minister of State, Home Office (Mr. Patrick Mayhew): We have enjoyed a very interesting debate, which I thought was all too short. I am grateful, as are all hon. Members who heard his speech, to the hon. Member for Islington, South and Finsbury (Mr. Cunningham), both for the quality of his speech and for the opportunity that it gave us to discuss this pressing and important subject.
We are all agreed that crime has increased, is increasing and ought to be diminished. More than half the recorded notifiable offences are theft and related offences. Burglaries amount to nearly one quarter; criminal damage to one eighth. The other offences—robbery, sexual offences and offences of violence against the person—are of much smaller proportions.
It is rightly the serious offences involving violence which most alarm people. The recorded increase in serious offences involving violence, although of course it varies from year to year, has been 2 per cent. a year over the past two years. Robbery, whether it be attacks on post offices and the like, or muggings in the streets, is a particularly serious threat to the citizen's ability to go about his business in safety. I agree with what the hon. Gentleman said about the fear in which many people, particularly elderly people, live. Although robberies form less than 1 per cent. of all recorded offences, their volume is serious enough, in all conscience.
So the great mass of crime with which the police have to deal involves the loss of property rather than injury to the person. Sometimes the loss is substantial; often it is very little. Two thirds of recorded property offences involved property valued at less than £100. But in one important respect the value of property taken in a burglary does not matter—the harm that is done is just as great in terms of personal outrage, indignation, fear of recurrence, and, as one so often hears, the feeling that the place has somehow been made unclean by such an invasion of privacy. That is important.
The picture offered by the statistics is pre-eminently one of widespread dishonesty and of rather less—though all too much—violence. Of course the criminal statistics show only what is reported to the police and recorded by them. It is well known that a good deal of petty offending goes unrecorded. One has only to think of shoplifting and expense fiddling to realise that criminal statistics are no measure of the full extent of crime. The British crime survey which we shall be publishing shortly will offer a new light on the extent of crime and its nature from the point of view of individual victims and households. Meanwhile, the Government's record, both in strengthening the police and promoting new legislation, shows their deep determination to protect people from the criminality that is in their midst.
The hon. Gentleman does well to draw attention to the social consequences of crime, and I, too, shall discuss them in a few moments. Most crime intimately and immediately hurts people—whether it be offences against the person or offences against property. Therefore it is a social evil, and one against which, accordingly, society as a whole should be prepared to mobilise its forces and fight. If it did so, crime would be greatly diminished. I agree with what the hon. Gentleman and other hon. Members have said about the need to mobilise public opinion against crime. The hon. Gentleman said that he held the old-fashioned view that crime was the fault primarily of the person who committed it. I wish to say a word along those lines.
Is it not rather strange that, instead of such a mass movement against crime, there is so much indifference to the need for us individually to help to prevent crime? Are the police, for example, really given sufficient help by the public? We know that they are not. There is almost a fatalistic acceptance that curbing crime is the responsibility of somebody else, and that that somebody is bound to fail. We do not have here that which Hitler feared most about the British people, and described in "Mein Kampf" as
that broad spirit of the masses which enables it to carry through to victory any struggle that it once enters upon".
That is not to say that there is not widespread fear of crime—of course there is, and it has been discussed

already. It is not to say that there is not indignation about crime; there is, especially among those who have witnessed its cruelty—most crime is extremely cruel. It is certainly not to say that there is any lack of determination in the Government or the police service to protect our people from crime and to take such actions and initiatives as are open to them. Huge additional sums are spent on law enforcement, and continuing thought is given to new approaches as well as to old approaches, whether by means of fresh powers for the courts or by new modes of policing. Yet we find that, of all the convictions and cautions recorded for indictable offences in 1981, no less than 54 per cent. were for offences committed by those aged 10 to 21. In other words, they were committed either by children at an age when their parents were still engaged in their upbringing and responsible in law for it, or by those within a year or two of graduation from that status.
Nearly one third of all offenders are under the age of 17. Most are under 21. While the rate of offending for adult men is around 12 per 1,000, for boys and young men under 21 it is more than 70 per 1,000.
I think that a society whose broad mass felt itself personally committed to diminishing the criminality in its midst would have seen a great reduction in the amount of juvenile crime before now. The undoubted rise in juvenile crime coincided with a trend towards permissive tolerance. Some in high places took pride in the permissive society. I wonder whether the rise in crime itself has caused or contributed to this indifference by inducing a weary familiarity with crime in most people. Is it paradoxically one of the social consequences of rising crime that there is individual apathy towards helping to reduce it? I think it is. If so, it is the most serious social consequence of all and must be vigorously corrected.
As the hon. Member for Thornaby (Mr. Wrigglesworth) and my hon. Friend the Member for Woolwich, West (Mr. Bottomley) said, there is a limit to what judges, magistrates, police officers and Governments can achieve. They must all do their best; Governments to give the police and the courts the powers that are needed; the judiciary to use them with firmness and discretion. The Government have done that. They have improved the morale and pay of the police. They have brought about an increase in the numbers in the police service in England and Wales of more than 9,000 officers. The Metropolitan police force is up by more than 4,000.
The hon. Member for Islington, South and Finsbury asked about foot patrols. Last year the Commissioner was able to put 1,000 officers on foot patrols—back on to the beat where the public wish to see them. The new Commissioner has said that he will place another 650 officers on the beat in the coming year. The Home Secretary has told the new Commissioner that he can look forward to the establishment of the Metropolitan police being increased to 27,000 by the end of 1983–84. The Metropolitan police is now only 350 officers short of its authorised establishment. It is an enormous achievement.

Dr. Summerskill: With regard to foot patrols, I realise that the Home Secretary does not have control of other police forces outside London, but will he use his influence on chief constables to try to encourage them to act in the same way as the Metropolitan police?

Mr. Mayhew: I noted what the hon. Lady said about Halifax. I know that it is the view of the Association of


Chief Police Officers that to bring police officers back on the beat is a desirable objective. However, it is in the family homes, and to a lesser but substantial extent in the schools, of our country that the crucial opportunity lies. There is no stronger social unit than the family. Its influence on its younger members has a far greater potential than any that they will meet outside it.
It cannot cause us much surprise that research establishes a link between criminality in children and indifference on the part of their parents towards discipline, order or supervision in the home. Criminal behaviour by parents, however trivial, is naturally an influential example to their children.
Nor should it cause us much surprise that so many juveniles who get into trouble come from broken homes. The director of social services for Hertfordshire told me only the other day that last year nearly all the children sent from the courts to his assessment centre had homes from which one of the parents had departed, hence leaving their principal responsibility for their children behind them.
Neither of those trends of permissiveness or of ready divorce was established in the 1930s at the height of unemployment, yet the 1930s saw no general increase in recorded crime on any scale comparable to today's. It is hard to resist the conclusion that, although rising juvenile crime has grave social consequences of its own, it is itself substantially a consequence of social changes of the sort that I have mentioned. Whether these are reversed, maintained or exacerbated lies only with ourselves in this community to decide.
Meanwhile, the Government have laid great stress on encouraging parental responsibility. For example, the Criminal Justice Act makes it easier for courts to make parents liable to pay fines and compensation orders imposed on their children. It strengthens the provisions for supervision while working in the community. It produces a night restriction order to keep children at home for a period. We have encourged the use of a formal police caution, which itself adds to the total of criminal statistics.
We are especially concerned for those who fear that they will become the victims of crime. They are naturally concerned about those crimes that are most likely to affect them in their ordinary business. The commissioner has already come in for praise from several hon. Members who have spoken in the debate, and I am grateful for that. In his recent report to my right hon. Friend the Home Secretary, he made it one of his priorities to improve the performance of the police in dealing with street robbery and burglary. He will be concentrating on improved information gathering, analysis and targeted action to improve the detection of crime. He intends to ensure that areas with a high incidence of street robbery, street disorder and burglary receive priority in the redeployment of manpower. He will also be using the district response units, when on standby, as anti-burglary and anti-rowdyism patrols. Actions of a similar kind to redeploy

manpower to the areas where it is most needed, and at times when it is most needed, are being taken by other chief officers.
Many issues to which hon. Members have referred are of great relevance to the problems that we must face. The hon. Member for Islington, South and Finsbury spoke of too much tolerance of petty crime. I think that my remarks show my warm approval of what he said. It is very much a problem of the attitude of the community in which young people grow up.
The hon. Member asked about police cells. He has been in recent correspondence with my noble Friend the Under-Secretary of State for the Home Department and he is aware of the action that is being taken to minimise the use that has to be made of police officers' time in the metropolitan area in acting as gaolers for those who have to be accommodated in police cells. The problem is derived from long-term neglect of the prisons and we hope that before too long we shall be able to reduce it.
The hon. Member asked about the enforcement of fines. In general, enforcement is not inefficient. We were able to make important improvements in the Criminal Justice Act. I parted company with the hon. Gentleman when he said that we lack intensive treatment other than that which is custodial. We can provide supervision that can continue virtually 24 hours a day. This is provided by supervision and probation officers, especially in probation hostels and intensive units such as the Medway unit. I agree that there need to be more of these hostels and units, but supervision is available under the law.
I agree with my hon. Friend the Member for Maidstone (Mr. Wells) about the importance of curbing truancy. It seems that the conditions that lead to truancy are the same as those which lead to juvenile crime. Undoubtedly, truancy needs to be vigorously curbed. I agree that there is too much legislation that makes criminals out of those who are not regarded as criminally culpable. As someone who voted consistently against the principle of enforcing the wearing of seat belts, I am sympathetic to what my hon. Friend said. However, that is water under the bridge.
My hon. Friend the Member for Maidstone talked about gipsies and said that some of their children are not attending school. I think that we all agree that such children ought to be chivvied into our schools. I am sure that that view is taken by Kent county council.
My hon. Friend the Member for Woolwich, West suggested that we publish crime figures area by area. It is a most interesting suggestion and one that we shall wish to consider. I very much agree with what he said about the use of voluntary bodies to raise the awareness of parents to the influence that they can have.
The hon. Member for Thornaby spoke about a greater sense of responsibility among those who live in a locality, and I agree with that. I must conclude my remarks in about 50 seconds—

Mr. Speaker: Order. The hon. and learned Gentleman has finished.

Orders of the Day — Ilfracombe Harbour

Mr. Tony Speller: In moving the debate rather abruptly from crime in the United Kingdom to the Bristol channel, I trust that the House will allow me to refer to notes rather more frequently than I would normally wish to do. In speaking about development I shall have to choose my words rather carefully from time to time.
Industrial development and employment have always been assumed to go hand in hand. New factories have been built in areas like north Devon. They have been sited in rural areas and firms have been induced, through grants and rates and rents, to inhabit them. When the winter wind of recession blows, it is not surprising that many of these firms go out of business or withdraw back to their original base.
Despite this, north Devon, in or around Barnstaple and South Molton, has below the national average of unemployment because the area has new and modern industry. Ilfracombe, which is the key point of my speech, does not have that advantage. It suffers, as all seaside towns suffer, from the problems of holidaymakers going abroad, of having a large, temporary labour force and, alas, of having few permanent jobs. In years gone by the labour force would come down to the west country to work in hotels for the summer and perhaps go to London for the banqueting season. Nowadays, many members of this seasonal work force stay put, and we have 27 per cent. unemployment in an area that has no year-round industry capable of absorbing young people and those who have come to stay among us in, perhaps, early retirement.
My theme is that Ilfracombe has tremendous potential for tourist and allied industrial development if only we can extend the harbour to take advantage of this uniquely beautiful north Devon location and its available resources. Situated on the Bristol channel, it has no major competition on our side of the water from any harbour for trawlers, roll-on roll-off ferries or coastal and marina-type business. There is no competition anywhere along the north Devon, north Cornwall or Somerset coastline because there is no reasonably safe harbour anywhere along the coast. As a result, there is comparatively little small-boat activity. Small-boat sailors, such as I, fear to go too far out to sea in the absence of a speedily achieved safe harbour for when the weather turns rough.
Ilfracombe has superb natural beauty with plenty of hotel and catering facilities. In addition, it has full development area status. The north Devon link road from the M5 is at last under way. It is 25 years too late, but at last things are happening and I thank Her Majesty's Government for that. Power supplies are being boosted and both electricity and gas boards are adding new links from Barnstaple to Lynton and Ilfracombe. This means that we shall soon have both roads and power supplies, two of the key necessities for industry.
Our unemployment rate is probably higher than anywhere in England at the present, not least because of the extremely short summer season, and despite the success of several hoteliers in building up coach connections, and in offering highly competitive terms for the senior citizen end of the package deal market. None the less, it is a depressed area and, in short, Ilfracombe needs an industrial shot in the arm that is more compatible

with a location that is distant from mass markets, and that takes account of the available work force and existing facilities.
Many innovative attempts have been made to provide more jobs. We have thoughts of a ski slope—we have plenty of hills for it. Industrial development committees have been established, and work experience schemes have prospered. I hope to seek, at another time, help from the Government in establishing major projects under the new community programme.
My scheme is simple in concept and would provide a major stimulus for Ilfracombe and North Devon in particular, and for the whole of the channel coastal ports in general. Mr. Alan Kift, an Ifracombe man, has provided one outline. It may not be the best, and it is certainly not the only idea, but its essence is simplicity itself. He says that we should extend our harbour wall in a curve from its present line by perhaps some 500 ft in total. We have a new flood prevention wall adjacent to the pier, which shows that it is possible to build walls even into our wave swept channel. I hasten to add that this is the Bristol channel, which is not exclusive to Devon.
What would happen from the provision of one simple wall extension? Initially we thought of the trawlers that have no haven in the winter months when the fish are more bountiful in our waters. We then thought about a marina for the small boats, then about a fishing quay for the trawlers. We went further and considered the advantages for small workshops, for the net-maker and the net repairer, for the small boat manufacturer, for fibreglass working, for the building industry, and for the repair and marine services. We already have hotel and catering establishments. All of these are available but good access to the water is not. It is rather like having a house with no access road. Ilfracombe is beautiful and fine, but at present there is no access by good road nor by good year-round water and we need both.
I can list some other benefits that would accrue. There would be a safe harbour in a coastal area where bad weather has always been a major hazard. Trawler berths and fish market facilities would be of especial economic value in winter. A roll-on/roll-off facility would reunite us with our friends in Swansea across the water. They have marina facilities and many boating activities which at present we cannot receive with the open arms that we should like. If we take this a stage further there is the prospect not only of the small boats and people crossing to and fro, but of facilities to allow lorries to cross and make their way south from Ilfracombe towards Plymouth and the ferry to Roscoff.
Better launching facilities for a lifeboat may seem a small matter to raise in a debate on industry, but our lifeboat has to be towed to the sea, which is a slow way to launch a lifeboat in a crisis. The RNLI, before my scheme was even thought of, had been discussing spending a vast sum on providing a safe berth in the water for the lifeboat. It is no secret that every year there are two, three or four new stories of vessels being wrecked, perhaps at Hartland point or further up the channel, because they have no harbour to go to when the weather becomes too much for them.
If we had the bigger harbour, weekend sailors would maintain their boats and extend the season. They would buy the occasional beer and bring their wives, children or girlfriends along to enjoy the pleasures of the Devon coastline. The season could be extended so that instead of


being virtually the school holidays, plus a month at each end, it would extend to six or eight months, which is at least two months more than it is now.
The service industries would boom for all those associated with the marina, marine activities or tourism. There would be extended business for hotels, restaurants and shops. The scheme would boost our moribund property market. It is fairly well known that along most of the coast, many hotels are for sale at an unreasonably low price. The poor suffering ratepayer will do far better if rateable values and property values increase.
We have industrial development status, but I would not personally put a factory so far from raw materials and markets. With industrial development status plus the ability to bring in boats and lorries, with the marina and the trawlers, people would take logical advantage of this status. Ilfracombe could once again become the booming and bustling place that it was 50 years ago.
The scheme would create permanent, temporary and seasonal jobs. There would be major work opportunities as construction progressed, and permanent work would be created in the service industries associated with a busy harbour and port. I hope there would be jobs in an educational spin-off of the outward bound sail training, and all the interesting and pleasant pursuits that at present we have to travel so far to find. Our own family boat is maintained at Dartmouth because it is easier to go 50 miles south to get on a boat that can be at sea in minutes, than it is to wait on the north Devon tides. One simple extended sea wall could help bring all these good things about.
If I talk about the channel it is because we also have the prospect, I hope, of the Severn barrage. If this comes about, there will be a need for a marine work base. Ilfracombe will not become the Aberdeen of the south but, none the less, those of us who believe that the Severn barrage is a good and sensible idea point out that vessels will need a base and a refuge when working on the barrage because the Bristol channel can be an unpleasant place in nasty weather.
When asked how such a plan should be controlled, I must tell the House that the whole project is in the hands of the north Devon district council. This is the local authority concerned, and during the next few weeks it will be discussing whether it wants to promote the scheme and, if so, how. With the help of our local newspapers, the weekly North Devon Journal-Herald and our weekly give-away, the North Devon Advertiser, I have been conducting a simple inquiry by questionnaire. Coupons have been put in the newspapers that ask not just "Is it a good idea?", but also "Is it quite a good idea, not a very good idea, or just a waste of time?" We also added a long list of the things that people might like to see in Ilfracombe. It is interesting that I have already received over 300 replies, which is not bad going in a week. Of the replies, 97 per cent. say that the scheme is a very good idea and most of the replies come from the Ilfracombe area, where the people have seen their area declining over past years.
I was surprised to find that the first preference of the people who replied was roll-on/roll-off ferry facilities. This was followed by more maritime facilities, including those for trawlers. Again, the people of the area were reverting to their old natural position and saying, "We have the sea, let us use the sea." Inevitably, this preference

was followed by that of tourism, then light industry, more car parks and, for our occasionally inclement weather, a leisure centre. Three options did not find favour—a big hotel complex, as we have plenty of small ones, language schools or a casino. I am quite pleased that the casino did not find favour. It was a realistic trade and industry reply from sensible citizens.
At this stage, all I ask of the Minister is encouragement for a sensible project, which will doubtless come to different Ministers for grant aid sooner or later. At least as important, the scheme will need the co-ordination of Ministers and Ministeries to back our search for funds in Europe. We are fortunate in our Member of the European Parliament, Lord O'Hagan. He has already been with me to look at the site and to talk about what we may be able to extract from our friends in Europe and how to extract it.
We need four specific types of help. First, when the Ilfracombe initiative is further advanced and has been fleshed out to the satisfaction of the appropriate Ministers, will the Minister be prepared to submit an application to the EC regional development fund? I am not asking for a categorical "Yes", but the Minister must know the conditions, and whether the scheme is worthwhile.
Secondly, can he assure me that the Government would hope to back realistic applications for money for a fishing quay, adjacent to the sea wall and for other allied activities? New funds may be available under FEOGA following the recent fisheries agreement.
I cannot pronounce the words that the FEOGA initials represent, but these grants are available for agriculture and tourism and my neighbour and hon. Friend the Member for Devon, West (Sir P. Mills) will doubtless explain, as he is well acquainted with how grants are extracted.
Thirdly, will the Government seek to ensure that the facilities of the European Investment Bank are made available to the scheme? Finally, and perhaps most important, when the applications are ready, will my hon. Friend the Minister let me know in due course which Department will co-ordinate the scheme? It is always the same problem. If one makes a poor application, one gets an unsatisfactory answer. It is vital for my constituents and for those who live along the coast on both sides of the water that sufficient help should be available to get the project started.
Interestingly, and again surprisingly, I have received telephone calls and letters from major international construction firms, and international and national banks—whose names are familiar to all of us—asking how they can help. They say that the idea is good and viable and want to know how much finance is needed. The project has caught the imagination of many outside our small part of the country. We are not just saying "Please do this for us." We want help along the road. I was sorry that the editor ended his leader in this week's North Devon Journal-Herald by saying
Lord O'Hagan and Tony Speller will have to work hard. We shall be watching them.
There is an inaccurate belief that Members of Parliament are magicians, with better or worse rabbits in the hat, or that we have magic wands. This is a case not for magic wands, but for the local council to think through and to decide how a project should be organised and controlled. The council has yet to agree that it should be organised at all. However, if that is agreed, then the people


must have the will to make it work, because without that it will not work. We have no magic wand, much as the Minister should like one.
I sought general approval from the public through the press; then from Lord O'Hagan, Devon Member of the European Parliament; from the chairman of our district council, Mrs. Freda Avant; and from the the chairman of Devon county council economic development committee, Mr. Michael McGahey. In addition, letters came pouring in from such bodies as the Barnstaple chamber of commerce, the Ilfracombe and district chamber of commerce, Ilfracombe harbour association, the hoteliers association of Ilfracombe, Ilfracombe publicity association, the Royal National Lifeboat Institution and the Ilfracombe sea cadets. Everyone seems to think that this project is a super idea, and so do I.
The Government spend vast sums on promoting employment in sometimes rather ephemeral ways. I ask only that they should think not so much of a lovely new factory stuck on the edge of Exmoor, where no one wants to go to make widgets, but of promoting the beauty of our country, the extension of our seascape and our old friendships across the channel. Many Devonians live in Wales and many of my friends are of all or part Welsh origin. The sea was our old road and perhaps some time soon it will be the new one.

Mr. Donald Anderson: I offer hands across the channel. From the Welsh side of the Bristol channel I am delighted to extend a hand of welcome and congratulation to the hon. Member for Devon, North (Mr. Speller). Like many Swansea people, I have the happiest memories of Ilfracombe. I also have blissful memories of summer trips across the Bristol channel on the Campbell steamers. As the hon. Gentleman said, there is a thriving Devonian society in Swansea, and I am sure that there is a Welsh society in Ilfracombe and other parts of Devon. Of course there are traditional links. The predecessor of my right hon. Friend the Member for Swansea, West (Mr. Williams) was a Vivian, from the Devon and Cornwall side of the channel.
We can easily see Ilfracombe and the lights of Ilfracombe from our side of the Bristol channel. Indeed, as you well know, Mr. Speaker, there is a local story that if we can see Ilfracombe it will rain, and if we cannot see it, it is already raining. I am sure that the Welsh side would give the greatest possible support to an investment project that would increase those traditional links, as outlined by the hon. Member for Devon, North. Swansea already has a success story in the new marina and a new lock gate was opened in December last year. That marina—the proud initiative of Swansea city council—is greatly oversubscribed. Therefore, I do not foresee any competition between Ilfracombe and Swansea in that respect, but rather an opportunity for cross-fertilisation between both sides of the Bristol channel.
Various projects have been considered for providing regular daily services between both sides of the channel, with perhaps a link through from Swansea to an Irish port and a link from north Devon to Plymouth, and from there to Roscoff. With the potential road links to Plymouth, the people of Wales may be provided with a speedy holiday link to France if the project goes ahead and if both sides of the channel are linked.
The relevant factors in promoting such links include the high cost at present to commercial vehicles, the tachograph—which means that many operators have to employ two drivers or allow for an overnight stay, which only increases costs—and the possible restrictions on commercial vehicles using the Severn bridge as usage increases over the years. In addition, such a development could save distribution costs, increase business between both sides of the Bristol channel and, as the hon. Member for Devon, North rightly said, increase job opportunities on both sides on the channel.
One major snag to the development of cross-channel links has been the lack of facilities for roll-on, roll-off vehicles on the Devon and Cornwall side of the channel. Another problem is the high tidal range at several ports. For example, two of the ports mentioned in this context—Padstow and Hayle—would mean an unacceptably long voyage time from Swansea, with consequent high charges and low vessel utilisation. The sailing time to those two ports would be five to six hours, which, with turn round time added, but with no allowance for any time lost through tidal restriction, effectively means one voyage a day. Therefore, that route would not be commercially viable.
I imagine that the voyage time to Ilfracombe is about two and a half hours. If the project goes ahead, that will be far more viable than the Padstow and Hayle route. Of course, substantial capital investment would be needed. An unproven route is unlikely to attract people unless they are prepared to take a high risk. Therefore, public money will almost certainly be needed. I am attracted by the suggestion that we should tap some European sources and the hon. Member for Devon, North was very up to date on the fishing possibility. I hope that the Minister will respond to that suggestion as positively as possible. At present, the commercial volume would be insufficient to justify a service, so I am attracted by the multifaceted approach of the hon. Member for Devon, North.
I assure the hon. Gentleman that there is great good will on our side of the Bristol channel and that all the projects for increasing links will be examined sympathetically by the port and local authorities in Wales. I congratulate the hon. Gentleman on his enterprise and initiative, and assure him that we in Swansea and in South Wales wish the launching of his project a fair wind and look forward to an increase in the number of links between the two sides of the channel. I am convinced that such an increase in links will be to our mutual benefit.

Sir Peter Mills: I congratulate my hon. Friend and neighbour the Member for Devon, North (Mr. Speller) on introducing this debate. As we say in Devon, it is a brave idea, and highly suitable for the area. As many of us know, the winds in North Devon are pretty strong, but I wish it a fair wind in the future.
It may interest you, Mr. Speaker, and the House, to learn that I have Welsh ancestors. My mother came from Cardiff, and one of the delights that she and I experienced was to go from Penarth to Ilfracombe on Campbell's boats, working forward to the marvellous cream teas that we used to have when we reached Devon.
The idea of a harbour of refuge and a place for seafaring men to go appeals to me very much. My great-uncle was a gentleman called Pilot Evans. He was one of the early pilots who used to go as far as Lundy to pick up the


steamers coming into Cardiff and Barry docks. Unfortunately, in a howling gale off Lundy, he drowned, along with all hands. So I have some connections with the area, apart from being a Devonian, and with the people on the other side of the water. I am also proud of my Welsh ancestors. Perhaps that is why I have some little ability to speak, which I know comes from the Welsh rather than the Devon side.
I fully support my hon. Friend's proposal. It will greatly benefit north Devon. I am particularly attracted to the idea of the marina. Boating and sailing are "in things" at the moment, and I see no reason why north Devon should not have facilities for them, as well as roll-on, roll-off facilities for more important industrial matters.
One only has to consider the Plymouth-Roscoff ferry, as a result of which there has been tremendous growth of business between the two countries. The same thing could happen with this project in north Devon. I only hope that the lessons of the Plymouth-Roscoff ferry will be learnt, and that British ferry firms will seize the initiative.

Mr. Tony Speller: I spoke only this afternoon to the retired managing director of the Campbell line, and he said that a decade and a half ago his company surveyed both Swansea and Ilfracombe and decided that Ilfracombe harbour could well serve a British ferry, but the problem was that there was nowhere on the Welsh side at that time to receive it. In fact, the Welsh have now jumped over us with their Swansea marina.

Sir Peter Mills: That shows that there has been some advance in the plan, which I welcome.
Moreover, the spin-off would be important, all along the coast, down the length of the Bristol channel towards Cornwall. My hon. Friend will know Appledore, which would have ship repairing facilities for any ships using Ilfracombe and the coast. I played a small part in getting Appledore Shipbuilders off the ground a few years ago, when I was the Member for that area, and that would be a plus for the scheme.
The spur road from the motorway to Barnstaple, which will eventually be built, will open up the whole area. We need something at the end of it, and my hon. Friend's proposal would help in that respect. In my opinion, industry would use its speedy access to the United Kingdom's motorway system. The spur road will help the plan, too.
This is a brave and useful idea, which I support not only because of my connections with Wales but because I want progress in the Bristol channel, particularly in north Devon, both economically and for the tourist industry. I hope, therefore, that Ministers will give it a fair wind.

Mr. Alan Williams: Since this brief debate started, I have noted the Minister's face paling. He is facing that most dangerous and unusual phenomenon in the House of Commons, a consensus across the Floor. It is a matter on which the Government Whips will have to act.
Our links in south Wales are well established with Ilfracombe on the Devon and Cornwall side of the channel. That part of my constituency is the Mumbles. The fishing communities are intermingled, and there is considerable intermarriage between the two sides of the channel. My

hon. Friend the Member for Swansea, East (Mr. Anderson) spoke of blissful recollections of crossing the channel on the Campbell steamers. My recollections are best summed up in an unhappy alliteration—nautical but nauseous. Little fits less into my recollections of that crossing than an Ilfracombe cream tea.
However, we welcome the development of a roll-on, roll-off facility between south Wales and the south-west peninsula. We commend the imagination of those who developed the idea. I hope that the Minister will view it favourably and see what can be done to help. There is little doubt that it would qualify, in terms of infrastructure, under the EC regulations. Regional fund money and social fund money would be available for a project of this nature, if it were given the appropriate Government backing. For us in south Wales it has the attraction, as my hon. Friend said, that it would represent a shortening of the transport times between the two areas. That would benefit both sides, because the markets would be more accessible to industry on both sides of the channel, and we would welcome the cross-trade that that represents.
The proposal would also benefit our two holiday industries. The Conservative Members who have spoken in this debate are justifiably proud of their tradition in the tourist industry, but with the Gower peninsula and the lovely stretches of south-west Wales that are easily accessible from Swansea, we, too, would benefit from holidaymakers coming in our direction.
In welcoming this proposal—I hope that what I shall say will not be seen as an attempt to undermine its objective—we do not want it to be thought of as an alternative to the ultimate recognition of the need for a second bridge across the Severn. For many technical reasons, which I shall not go into, it is well known that there is an urgent need for such a project. I hope that the Government will not view this proposal as a low-cost alternative to a different transport need, meeting a totally different requirement.
Finally, the hon. Member for Devon, North spoke with optimism of the benefits that would accrue to Ilfracombe from improved road access. I warn him of the sad fact, which we in Swansea are learning, that roads have a strange habit of going in both directions. We have just learnt of the departure of Dragon Computers, which was seduced away from Swansea by the Government through the use of grants. As I say, access can be a way out. We have lost jobs because of that factor.
However, we would not want to appear to be impeding the project. We hope to be kept informed of its development. Any help that we can provide in developing a project that we believe might also benefit our side of the channel will be available.

Mr. Arthur Palmer: The House is greatly indebted to the hon. Member for Devon, North (Mr. Speller) for raising this subject. I have close personal knowledge of his constituency. A story often told against me in my family, which causes me to blush to this day, is that when I was aged about six or seven I was heard thanking God that I had been born a human being, secondly that I had been born a Briton, thirdly, that I had been born an Englishman and, fourthly, that I had been born a Devonian. I did not at that stage particularise


between north and south Devon. I was, in fact, born in north Devon, between Bideford and Appledore, and spent much of my boyhood there.
The hon. Gentleman is right in what he says about the economic situation of the peninsula. In Bristol, we have more than our fair share of unemployment and the figure is increasing. Further west, as the hon. Gentleman stated, unemployment mounts to greater heights. I am sure that the hon. Gentleman's figure of 27 per cent. in north Devon is right. The difficulty is that much of the employment is seasonal. The area depends, as it has always done to a great extent, on tourism. An area of considerable natural beauty, it is attractive to visitors but seriously lacks industrial employment to add to agriculture where employment has steadily fallen, as elsewhere, over the last 100 years due to mechanisation and other changes.
The difficulty is how to add to the stock of industrial investment without detracting from the natural charm and amenity of the south-west and its appeal to tourists. For a number of years, the south-west regional council of the Trades Union Congress, at one time under the leadership of Mr. Brian Bailey, now Sir Brian Bailey—knighted for his public service and service to trade unionism—has given attention to these matters. I do not claim that efforts to promote employment have made much impression on Governments of either party.
It can perhaps be stated in defence of the Labour party that we have little south-western parliamentary representation in the House apart from in Bristol itself. Hence, Bristol Labour Members see themselves as the trustees of the Labour cause in the south-west until we can win back constituencies such as Exeter, Falmouth and Camborne, Taunton and Plymouth that we once held.
I am glad that the hon. Member for Devon, North raised the issue of more industrial activity and better harbour facilities at Ilfracombe. There has been reference to Appledore. However, judged by the statement made in the House today, the hon. Gentleman will not get far with present Ministers. It is bad news that the cable-laying ship required by the Central Electricity Generating Board to help provide the cross-Channel connection between the British and French electricity grids is to be built in Korea. There were protests from both sides of the House today. Like my hon. Friend the Member for Swansea, East (Mr. Anderson), I wish the hon. Member for Devon, North a fair wind and all success in his representations. There is a common interest among all hon. Members representing the south-west.
The hon. Member for Devon, North mentioned the Severn barrage briefly. If the barrage were constructed, it would be a source of employment not only in the southwest but all the way along the Bristol channel on both the Welsh and English sides. It would also be a considerable source of employment for the whole of British industry. A vast amount of engineering work—mechanical, civil, and electrical—would be involved. The project would embrace the whole range of British engineering.
If constructed, the barrage would be one of the engineering wonders of the world. The Severn estuary is one of the best sites for tidal power anywhere in Europe and probably ranks third or fourth in the world, due to the physical nature of the estuary. In my view, as an hon. Member who takes a close interest in energy matters, it is the only practicable renewable energy source that will provide electricity on a truly large scale. It has been talked about for half a century. Before the war, there was the

Brabazon report. However, had the barrage been constructed at that time, it would have now proved so small in relation to the total electrical load of the country that we would have to be thinking about a second barrage.
Today, the output from the barrage, if it was constructed to full capacity, in tidal terms of the estuary, would match the total output of the electrical grid. In the 1970s, the Select Committee on Science and Technology, of which I had the privilege to be Chairman, recommended an up-to-date study of the subject. The suggestion was adopted by the then Labour Government. Sir Hermann Bondi, a distinguished scientist and a man of all-round technical knowledge, was appointed as chairman I was appointed by my right hon. Friend the Member for Bristol, South-East (Mr. Benn) as a member of the Bondi committee.
We worked hard for two years and reported 1981. Our proposal was and is that there should be a barrage from near Weston-Super-Mare on the English snore to Lavernock point near Cardiff on the Welsh shore. That barrage will give an electrical output of between 7,000 and 8,000 MW, which is equivalent to the output of about four large modern power stations, whether they be coal-fired, oil-fired or nuclear stations. We had much expert assistance and were able carefully to calculate the Arming costs. Without giving the exact figure, the cost per unit would fall at a point between that of producing electricity by nuclear power and that of producing it by coal. It would be less expensive than coal and rather more expensive than nuclear power.
The barrage would be a great power station driven by tidal power. The intention would be to feed the electricity into the national grid, producing in this way between one sixth and one eighth of Britain's electricity needs.

Mr. J. F. Pawsey: Is the hon. Gentleman aware that many Conservative Members endorse what he has said and believe that such a project would be a valuable source of jobs and provide much pollution-free power? Many Conservative Members would like to see the Severn barrage scheme go ahead as soon as possible. I hope that the hon. Gentleman will touch upon the fact that a consortium exists which even now is looking into the prospect of building a Severn barrage. I mention that because, as I am sure the hon. Gentleman knows, the General Electric Company in Rugby, which produces turbine generators, is very much involved in that project.

Mr. Palmer: I am grateful to the hon. Gentleman for his support and I hope that he will join me in prevailing upon the Government to take some action.
There is of course a problem, in that tidal power moves according to the lunar cycle, which means that its unit output relative to capacity is not so good as that of, say, a nuclear station or a large coal-fired station that can be kept continuously on the base load. However, we need not go into that here.
The scheme would create much employment throughout British industry. We are not dealing here with some difficult new technique. There are undoubtedly serious civil engineering problems to be solved, but, generally speaking, a barrage would use well established and understood techniques. It would give the electricity supply industry—I declare my interest here through my trade union and industrial connections—an extra security of supply because, in addition to coal, oil and nuclear fission, we would have a fourth primary source.
The Bondi committee proposed further technical studies, costing, I think, between £12 and £14 million, without necessarily a commitment to proceed with the barrage, though I think that the two would go together. The House and the country—certainly the west country—are still awaiting the Government's decison. It will soon be two years since the Bondi committee reported and we were once promised a decision or a statement within six months.
The financing of such a project with its enormous initial cost is a difficulty, which I do not minimise. It requires a great effort of political will to make the decision. I appreciate that. I do not think that the CEGB would want to put up the money because it would adversely affect its public sector borrowing requirement. I favour the creation of a Severn barrage authority, a public corporation, uniting both sides of the channel with some general amenity and social obligations in addition to its primary task of generating electric power through the barrage. It would need to have the right to raise capital from both private and public sources which could be done by means of Treasury guarantees as the original bridge scheme was financed in the 1970s. The operation of the barrage would be best organised under contract to the CEGB, which would purchase the output, of course.
I hope that the Minister will say, if he can, when the Government will make up their mind. As I have said, a scheme of this size and potential would create a vast amount of work, certainly in the Bristol channel area and, in engineering contracts, for the rest of Britain. It would also provide a fine new area of water for recreational purposes. The Government should not dither any longer. They should at least decide to go ahead with the next stage, as Bondi recommended.

The Under-Secretary of State for Industry (Mr. John MacGregor): I congratulate my hon. Friend the Member for Devon, North (Mr. Speller) on raising this matter this evening. I know that it is, or could be, one of great importance to his constituents. Therefore, I shall confine my remarks to his proposal rather than deal with the speech made by the hon. Member for Bristol, North-East (Mr. Palmer), which ranged more widely, and I hope that the latter will forgive me for so doing. However, I shall ensure that his remarks on the Severn barrage are drawn to the attention of my right hon. and hon. Friends.
I shall concentrate my remarks on the four questions asked by my hon. Friend the Member for Devon, North. I am sure that he will be grateful for the support that he has received from all hon. Members tonight. I would tell the right hon. Member for Swansea, West (Mr. Williams) that I was in no way paling before his remarks; I was simply reflecting on the fact that, like every hon. Member who has spoken in the debate, I know the area of Ilfracombe extremely well. As my hon. Friend the Member for Devon, North knows, my family when younger always, holidayed in Ilfracombe and we have many happy memories of that town. Indeed, we return to it from time to time even now. I recognised all the spots that he showed me on the map that he gave me earlier with the harbour proposal on it. Therefore, I appreciate what an attractive spot it is, as do all the other hon. Members who have spoken, and I understand the hazards of tides and

winds and the problems of communication for industry on the land side of Ilfracombe. I understand why my hon. Friend has made his proposal and I recognise the town's considerable tourist potential.
Although I do not want to suggest that the unemployment problems of Ilfracombe are as severe and intensive as those of other parts of Britain, I recognise that Ilfracombe has an unemployment problem, particularly a seasonal one. Therefore, I understand that as one of the reasons for my hon. Friend's proposal.
My hon. Friend's proposal for the development of Ilfracombe harbour is interesting and imaginative. It is worth a close examination—first, locally. I cannot comment tonight in detail, having just seen the proposals. The north Devon district council, as the harbour authority for Ilfracombe, will wish to give these ideas the closest attention. My hon. Friend will be the first, I have no doubt, to agree that such an important and potentially costly project will have to be approached with a keen sense of realism. The proposal is still very much in embryo, and wide-ranging considerations will need to be examined before the local authority can reach any firm decision to proceed. These are considerations which must be pursued locally, and I would not presume to comment tonight on the merits of a project in so far as it must first be considered locally. I am pleased that my hon. Friend is taking extensive soundings of his constituents about the scheme.
Although capital investment projects such as these can naturally bring welcome relief on a short-term basis to the pervading problems of local unemployment, it is important always to look to the longer term to ensure that today's scarce resources are sensibly directed into projects that will bring lasting benefits to the economy of the local community.
Ilfracombe is an historic town and resort lying in a beautiful corner of the South-West. Its harbour is one of its attractions to visitors, including my family, who appreciate the scenic qualities of north Devon—an area of outstanding natural beauty.
Any development of the harbour would clearly have to be undertaken sensitively to ensure that its attractions were not lost but enhanced. I have little doubt that the local authority, as harbour undertaking, will wish to take the best possible advice on the range of viable development options that may be open to it. The local authority, and Devon county council as highway authority, will also want to consider fully the implications of major development on the town's traffic and general environment.
I wish to be as helpful as I can to my hon. Friend in giving guidance as to the various considerations that he will have to take into account.
Beyond that, the district council will no doubt appreciate that fresh statutory powers may be needed to authorise the extension of its harbour; and any project costing over £3 million will require the authorisation of my right hon. Friend the Secretary of State for Transport under section 9 of the Harbours Act 1964. Officials of the Department of Transport are naturally always ready to advise on these matters if required.
Assistance towards the cost of important new infrastructure works that contribute to the economic development of assisted areas is available from the European regional development fund. Ilfracombe is a development area in recognition of its unemployment problem.
As my hon. Friend knows, the Mullacott Cross industrial estate in Ilfracombe and the reinforcement of the Barnstaple-Ilfracombe gas main have both received 30 per cent. grants. My colleagues in the Department of the Environment will be happy to consider further applications for qualifying projects at Ilfracombe, consulting as necessary with other Departments that may be involved.
I make it clear that port undertakings in assisted areas may apply for grants towards infrastructure projects, usually at 30 per cent., from the fund. To qualify, the project needs to be viable and in line with the regional policies for the area.
The north Devon district council will not need to be reminded that it would require a capital allocation under the Local Government, Planning and Land Act 1980 before it could embark on a major capital project of this kind.
It might be appropriate to say a few words at this juncture about the Government's general policy towards the development of ports in this country. The central theme is that the port and harbour authorities should manage and develop their undertakings on a clear commercial basis. The Government are also encouraging ports to look to the private sector for capital finance and to be less dependent on Government loans. The main type of development, which in part is what my hon. Friend is proposing, could well be suited to financing as a commercial venture rather than as a charge on the ratepayers.
I was interested in what my hon. Friend had to say about the response in terms of inquiries that he has already received from banks and others since this project was mooted. I hope that the local authority will consider this as a possible approach among the options open to it in developing such a proposal.
The Government have already recognised the need for improved communications in north Devon. The north Devon link road will bring relief to several routes in north Devon, especially in the summer months, and will contribute to removing one of the major barriers to further development in the north Devon area. The link road will eventually replace the A361 as the trunk road from Taunton to Barnstaple. As my hon. Friend knows only too well, and as I know from time to time, the present A361 is a very tortuous and narrow route, not capable of improvement except at great cost; hence the decision that a new corridor route would be a more viable solution.
Stage 1 of the link road from the motorway to Tiverton is now under construction, with completion expected in

the spring of 1984. The Department of Transport is about to publish the statutory orders for the first phase of stage 2.
On my hon. Friend's comments about the fishing potential in the Ilfracombe area and his question about FEOGA, I am informed by my right hon. Friend the Minister of Agriculture, Fisheries and Food that he has no knowledge at present of significant unexploited fisheries potential in the Bristol channel area. If commercial assessments of such a potential suggested a need for harbour development in north Devon, a grant might be considered for approved costs under fisheries legislation to the extent that it could be demonstrated that there would be a benefit to the fishing industry. Any aspects of the development involving marketing and processing activities could be eligible for consideration for the FEOGA grant. Further information on this aspect can be obtained from the Ministry of Agriculture, Fisheries and Food.
My hon. Friend asked me about the European investment bank, and the viability of EIB funds for the Ilfracombe scheme. It will be for the local authority, as harbour undertaking, in the first instance, to decide whether the EIB could be an appropriate source of finance. He obviously would not and could not expect me to give him an answer at this early stage on whether that would be the procedure to employ.
I turn finally to the question which Department would co-ordinate the applications towards European Community sources. I think that that depends on the shape that the proposal ultimately takes. If it is fundamentally an environmental proposal or an infrastructure proposal on the port side, it would be a matter for the Department of the Environment. Other Departments will be involved as well. If my hon. Friend will see me when he is ready, I will be willing to guide him to the correct Department.
I congratulate my hon. Friend on his initiative. I do not have a magic wand in my kit on this occasion. He himself said that there were no magic solutions for most of the issues we face as politicians. His suggestions, I am sure, will be given serious consideration by the local authorities and others concerned for the future well-being of the Ilfracombe area.
I have outlined some of the considerations which need to be taken into account, which I hope will be helpful to my hon. Friend. I am sure that my colleagues and their Departments stand ready to offer what advice and assistance they can in their respective spheres of responsibility.

Orders of the Day — West Midlands (Unemployment)

Mr. Geoffrey Robinson: This is the first time that the House has discussed unemployment in the west midlands since December 1981. In other words, during 1982 the west midlands as a specific region was absent from our debates. It would, however, be wrong to infer that hon. Members on either side have been unaware of the growing unemployment crisis, which is now reaching breaking point. All hon. Members will, therefore, I am sure, welcome this opportunity of putting to Parliament and the people their views on this truly desperate situation and on what is required to put it right.
The manufacturing heartland of Britain has become a wasteland of closed factories. The charge that we lay at the door of the Government is factual, simple and direct. We charge them with the total devastation of the employment structure of the west midlands. We sustain that indictment because in practice the Government's policies have been universally destructive of the west midlands. The charge is total, because the destruction of jobs has been universal and indiscriminate, as the figures will show.
Unemployment in every area within the west midlands has increased, as it has for every part of Coventry, the city that I represent. There are no geographical bright spots. There is no relief between age or category of worker—between white or blue collar workers. There is no difference between the young and married couples; men and women; or long-serving employees. All of them have seen their legitimate hopes of training, jobs, promotion and properly deserved retirement savaged by Conservative policies.
Nor has there been relief for categories of industry. Manufacturing has been worst hit, but employment levels in the utilities—gas, electricity and water—as well as in the service industries have declined year in, year out.
There has been no relief by size of company or institution. Large, medium and small have all declined—with record levels of liquidations in every year of the Government's administration.
There has been no relief as between ethnic groups. White and black have both suffered, but the percentage of registered unemployed belonging to the ethnic minorities in the west midlands is three times larger than that of Britain as a whole. Worse still, the ethnic unemployment rate is likely to rise even faster—a powder keg threatening social stability in the area that we represent.
No statistics can adequately represent the human misery that these plant closures, redundancy notices and never-ending dole queues mean for the people they affect, but we must use the statistics to measure and quantify the comprehensive failure of the Tory policies that have caused them.
We are pleased that the Secretary of State for Employment is present. That is appreciated, even though there is little that we can say in favour of his policies. The right hon. Gentleman's presence is welcome, as it gives us an opportunity to put some straight criticisms to him.
On the right hon. Gentleman's own "cooked" figures, unemployment in the west midlands has gone up from 111,000 in 1979 to a staggering 367,000 at the end of 1982—a vicious increase of 229 per cent. Frankly, it is

difficult to comprehend increases of that magnitude. There has been a trebling of the region's unemployment rate, from 5·2 per cent. in 1979 to 16·1 per cent. at present. That is by far the highest rate of increase in unemployment for any region in Great Britain.
The figures are worse still in Coventry. In June 1979, 15,000 people were unemployed. In October 1982—and it has gone up since then—there were 45,000 unemployed, an increase of more than 250 per cent. In 1983 the overall level of unemployment in Coventry will rise to 20 per cent. Indeed, male unemployment in the region as a whole is already 20 per cent.
The results of this tripling in unemployment are to be seen in the tragic loss of material and human resources. In the west midlands as a whole there are now 300 million sq ft of empty factory space. That is a stark reflection of the fact that the west midlands has lost 30 per cent. of its manufacturing capacity, yet the Government still refuse to acknowledge that that represents a structural problem in our industrial performance. Later, I shall comment on the positive recommendations that we shall make to try to get the Government to change their direction and content of policy, to face the misery that they have caused and to embark on a policy of construction rather than one of destruction.
In Coventry, only 15 per cent. of youngsters gain full-time employment. Of the 85 per cent. who join the combination of training and release schemes that the Secretary of State has grudgingly created, only one in four is thereafter likely to get a permanent job.
That can only be described as a wasted generation whose hopes have been blasted by monetarist dogma. What chance do the young have? Apprenticeships have fallen from 600 a year two years ago to under 400 today. The skilled man who has completed his apprenticeship, the person approaching retirement age, but still with a few years to go, and the youngster who has just left school can try their luck with the 58 other people who are now chasing every vacancy. There will not be room to park their bikes, let alone get an interview.
Confronted with a picture as unrelievedly black and desperate as the plight of the west midlands, what has been the Government's response? Under pressure for electoral and other reasons from their own Back Benchers, bombarded by delegation after delegation of local councillors from Birmingham, Coventry and the other districts, and continually subjected to pressure at Question Time, they have done absolutely nothing. Their attitude has been aptly described in other matters of state as "general Micawberism"—hoping that something might turn up.
The Chief Secretary to the Treasury told us a year ago that the evidence of recovery was all about us. We shall be interested to hear what the Minister says tonight. Who are they trying to kid? Can a Government or a Minister be so out of touch? I ask that, because it is clear that the Chief Secretary is no worse than the rest. The Secretaries of State for Industry and for Employment and the Prime Minister herself are just as out of touch as he is.
What can one say of the Secretary of State for Employment? We are told that he is a man of courage and principle, yet he even funks a visit to the production line of Jaguar cars and instead sneaks into the styling studio—

The Secretary of State for Employment (Mr. Norman Tebbit): The hon. Gentleman funked every issue under the sun when he was managing director, which led Jaguar into the troubles from which it is now being pulled out. He knows that it was never proposed that I should visit the production line. I wanted to see the R and D section, because I was the Minister who took the decision to finance the XJ40. I showed some faith in Jaguar, which, under the managing directorship of John Egan, has been more than fulfilled. It is a pity that the hon. Gentleman could not achieve those results in his day.

Mr. Robinson: Out of consideration to my hon. Friends, I shall not pursue that argument—[HON. MEMBERS: "Ah!"] In that case, I shall.

Mr. George Park: Will my hon. Friend give way?

Mr. Robinson: Perhaps my hon. Friend will let me deal first with the Secretary of State's intervention. I am grateful to the right hon. Gentleman for allowing me to put the record straight. He really should not have intervened. Production at Jaguar is now about half the number of cars that it was producing when I left. It inherited the model that I left with it. Its profitability is in real terms barely half what it was when I left—[Interruption.] The Secretary of State may not like the facts, but it is as well that he did not go around the production line, because I do not think that he would have been a welcome visitor.
In addition, Jaguar's profits and cash flow are not in real terms as good as they were when I was with the company. Having said that, let me add at once that there are Jaguar factories in my constituency, and no one welcomes more than I the progress that has been made. Equally, no one recognises more than I the progress that must still be made before the confidence of the work force is restored. I am sure that the managing director, unlike the Secretary of State, recognises the importance of good industrial relations.
When the Secretary of State goes to the factory he funks the issue and sneaks into the styling studio. He tries to develop John Egan into the Government's latest pin-up boy in succession to Michael Edwardes. However, it is better to be the Prime Minister's pin-up boy than the Japanese Government's favourite Geisha girl, which is the only title that one could give to the Secretary of State for Employment. When he was at the Department of Industry, there was nothing that he would not do to get the Japanese here. He was crawling on his hands and knees and kowtowing to them in every possible way to persuade Nissan to invest in this country. Has he no faith in British engineers, British skills, British management or British workers? Will he or the Under-Secretary of State answer our questions this evening? Are we to have Nissan, or not? What are we to have by way of investment?

Mr. Tebbit: Does the hon. Gentleman want Nissan, or does he want to keep Nissan out?

Mr. Robinson: I shall give the right hon. Gentleman the same answer as I gave him when he made the announcement with such a panoply of glory, only to see the prospect disappear further and further over the distant horizon. I want investment from Nissan on the right terms, but not on the terms which, in his ill-informed and illiterate fashion, the Secretary of State put forward then, when he described his ineffable vision of British workers using and maintaining Japanese-designed robots.
If there is to be a real transfer of industrial and technological know-how from Japan to this country, my answer is "Yes, we will have Nissan". However, the conditions laid down by the Secretary of State and inherited by his successor at the Department of Industry have been whittled away to non-existence in the Government's desperate and abject eagerness to get the Japanese here because the Government are unwilling to back British management or British workers.
That digression was forced upon me by the surprising eagerness of the Secretary of State to come to the Despatch Box, but my main concern is the level of unemployment in the west midlands, which everyone except the Secretary of State agrees to be a very serious problem, and the suffering caused there by the perpetuation of the Government's employment and industrial policy. It is clear from the irrelevant interventions of the Secretary of State for Employment today that we cannot look to him for salvation. Nor can we expect any help from the Secretary of State for Industry. They are two of a kind.
Moreover, if we study the Prime Minister's famous interview with Mr. Walden on London Weekend Television—it has now been issued as a press release from No. 10 under the title "The Resolute Approach"—we see that we cannot hope for much from the Prime Minister either. She spoke about what will happen
if we keep our policies firm and do all the right things, you know,"—
she may know, but I do not—
keep public spending under control, keep the budget deficit low, keep public borrowing down, keep the money supply under control.
That is all that we have from the Prime Minister.
What is the relevance of any item on the list that the Prime Minister enumerated with such emphasis and such pride in that interview? It is hard to see how the west midlands will benefit from any of those policies. Indeed, it is in fact hard to see that any of them is being successfully implemented. Inflation came down while the money supply expanded and, even if the money supply is under control, interest rates are now higher in real terms than at any time since the second world war. That took some doing.
Unlike others, I find some glimmer of hope in the Prime Minister, as she is more of a realist than many of her colleagues. She knows that something must be done in the west midlands if the Tories are to have any chance of retaining key marginals there at the next election. She realises that her party cannot go into an election with unemployment continuing to rise at the rate that it has risen and continues to rise in the west midlands, so she is under pressure to do something about it.
As we saw last October, the best way to put the Prime Minister under pressure is for a group of industrialists to visit her, as they usually represent companies with handsome contributions to make to the Tory party. It was not enough that 400,000 construction workers were unemployed, 2 million bricks were stacked around the country and the house building programme was at an all-time low. None of that made any impression, but eight good men and true turning up at No. 10 in their building helmets and telling the Prime Minister that something had to be done made quite an impression. Within a week the Secretary of State for the Environment had stood on his head and instead of saying "Cut, cut, cut," was saying, "Spend, spend, spend" and "Build, build, build." That


was nothing to do with keeping borrowing under control or not spending Government money. On the contrary, it means spending Government money to help private industry, but that is what the Prime Minister did for the construction industry, and it should have been done two or three years ago. I am glad that the Secretary of State for Employment agrees.
Let us take the analogy a little further. If that was right for the construction industry, why is it wrong for manufacturing industry? We all know that for every £1 spent by the Government on construction or manufacturing, an average of 70p goes to the private sector for goods and services. The Secretary of State shakes his head as though that were not a fact, but we all know that that is why the expanded public sector spending programme for the construction industry was of such great assistance to the private sector companies, which almost exclusively benefited from it.
If the Government will recognise that they have as important a role in manufacturing industry in toto as in the construction industry, we may yet reverse trends that will otherwise be terminal for manufacturing industry in the west midlands. The example of the eight construction companies is relevant to the west midlands, because the Government cannot simply pass the buck to industry. The Government have as vital a role to play in relation to manufacturing industry as they have in relation to the construction industry.
Whether the Secretary of State and the Prime Minister like it or not, the Government are responsible for the devastation of the west midlands manufacturing base and for the increase in unemployment, which is now 355,000, more than 16 per cent. The proportion of that total who have been unemployed for one year or more is now 41 per cent., or almost 150,000 people. In Coventry, 86 per cent. of youngsters leaving school have no jobs. There are 58 people chasing every vacancy and 300 million sq ft of factory space lying vacant and rotting. Worst of all, there is no sign of improvement and every sign that things will continue to get worse.
To establish what is wrong and to fix responsibility where it belongs is not playing party politics. It is essential to know what is wrong if we are to put it right, but we must not stop at criticism. We must put forward practical and realistic policies to reverse the decline.

Mr. Anthony Beaumont-Dark: Did not the Labour Government's policies on industrial development certificates from part of the foundations for the decline of industry in the west midlands? If the hon. Gentleman would analyse the past honestly, we might believe in some of his panaceas for the future.

Mr. Robinson: That is going back a long way. We have had this argument before. I can go back as far as anyone wishes. Let us go back to the 1870s and to 1851 and the great exhibition. Let us go back to the education system that does not produce enough of the engineers, designers and technologists that we need.
I will admit to one mistake that was made by my party when it was in government. As the hon. Member for Birmingham, Selly Oak (Mr. Beaumont-Dark) invites me to put the record straight, I can tell him British Leyland, and especially Jaguar, were adversely affected by the

appointment of Lord Ryder and the implementation of his lunatic plan for Jaguar. That was the occasion of my resignation from Jaguar.
From then on, bad mistakes were made in relation to British Leyland by the National Enterprise Board, which was set up by the Labour Government. Certainly Jaguar's performance after the report suffered greatly and there has been a wider degree of economic decline than need have happened because of the interim period of poor performance by Leyland, following the report. I am prepared to accept that my party made a mistake, both because it is true, and because it gives me the opportunity to tell the Secretary of State for Employment the reason for my resignation, after which the decline in Jaguar's fortunes took place.
We must be practical and positive. I am aware that many of my hon. Friends wish me to push on. It is a well-attended debate, and time is pressing. I shall compress my speech in a way that will not do it justice to the positive proposals, but I hope to find another occasion to develop the arguments.
My first specific proposal is one to which I hope the Minister will give a clear answer. The whole of the west midlands metropolitan county should be designated as an assisted area. We have had from time to time some all-party support on the issue. Certainly that is so for Coventry. The figures that I have quoted, and further figures that I could quote clearly show that there is structural decline, by any definition. If the designation of the west midlands as an assisted area is resisted, different criteria must be used from those presently established for such a area.
The clear recognition of structural decline brings me to the central importance of the motor industry to the west midlands economy and to the country as a whole. It would be a supreme irony for successive Governments and the Secretary of State for Employment—he served in the Department of Industry, where the Secretary of State opposed plans for investing in British Leyland—if, having poured £1 billion into British Leyland to save our one nationally-owned motor car industry for Britain they now preside over the collapse of the component and capital goods supply industries.
My second proposition is therefore that the Prime Minister should call together the chairman of British Leyland, with leaders of eight major component and capital goods supply industries—as she did for the construction industry—to hammer out a massive and accelerated purchasing programme for British made equipment. Companies that immediately spring to mind are John Brown, Tube Investments, GKN, Associated Engineering, Automotive Products, Dunlop, Lucas and Armstrong Equipment. Nearly all those companies are household names. They are cutting their work force to the bone because of the decline in demand for their goods. If action is not taken quickly, such companies as GKN will turn into vast warehouses for the importation of Japanese and other foreign components.
The Government can count on the full support of the trade union movement. One hundred trade unionists met in Coventry during the weekend and committed themselves to a co-ordinated campaign to achieve for the capital goods supply and components industries the survival which successive Governments have achieved for British Leyland.
Thirdly, the Government must resolve the wretched Nissan project. They have pandered to Japan for long enough. They have lost all self-respect. Let us have the matter tidied up. Is Nissan coming to Britain, or is it not? I know the difficulty, because I have negotiated with the Japanese, as have many hon. Members. But there comes a time when the laughing, the silly behaviour, the chattering, the Secretary of State's behaviour this evening, the trips and the public relations must stop. We must realise that we are dealing with the jobs of real people.
The investment intentions of other companies could be affected by the project. The Government should take their courage in their hands and tell the Japanese that if they do not put the investment under way within three months we shall reduce the Japanese quota by half. An agreed level of about 11 per cent. has been adhered to and this should be reduced to 5 or 6 per cent. if the Japanese do not proceed with the Nissan plan. They might surprise the Secretary of State by deciding to go ahead with it.
Fourthly, there should be selective import controls on Spanish and east European manufactured motor vehicles. We should reduce their market share from 6 to 3 per cent. We could then have a nationally co-ordinated investment policy which, together with import restrictions, would ensure an increased market opportunity for British-based producers, and British Leyland in particular, of up to 10 per cent. of the market.
Fifthly, we must ensure that modern productive capacity is available for that purpose. The £500 million earmarked for the Nissan project—if it does not come to Britain—or an additional £500 million if it does, should be made available to British-based manufacturers under the Government's national selective industrial assistance scheme covering the new science-based and traditional industries.
Because of the pressure of time I shall not discuss the relationship between the new science-based industries and our traditional industries. However, we must realise that the science-based industries need, as major customers for their products, continuing healthy and thriving traditional industries.
I do not suggest that such a five-point package will solve all the problems of our tragically depressed area. But I contend that unless some new programme of specific Government-supported measures of recovery is instigated, the trend of decline will continue irreversibly and will be terminal within a matter of years. That need not happen. We can still find and train the skills that we need. Managers, engineers and trade unions are yearning for a lead. We have inventive and adaptive attitudes and abilities second to none. Tonight, the Opposition say to the Government that they must look at the industrial disaster they have created and the human despair they have spread and change their policies before it is too late. They must get monetarism off the back of the west midlands, and get the west midlands back to work.

Mr. Hal Miller: The hon. Member for Coventry, North-West (Mr. Robinson) will understand if I preface my remarks by saying what a pleasure it is for me and my colleagues to see the hon. Member for Eye (Mr. Gummer) on the Government Front Bench. I congratulate him on his promotion.
I wish to acknowledge the interest taken by my right hon. Friend the Secretary of State, whose presence this

evening we all welcome, and also the presence of my hon. Friend the Member for Coventry, South-West (Mr. Butcher) who, although itching to take part in the debate, is debarred by the rule that there should be only one Front Bench spokesman on this occasion. I know that he would wish to make a contribution to the debate, and that he has a great deal to offer.
I thought that the hon. Member for Coventry North-West, when wrapping up his speech, should have wrapped up his case. It was entirely unworthy of the position in the west midlands. He made some cheap political cracks which bore no relation to the position in the area. Nor did they do justice to the occasion. I shall deal later with the rather sketchily presented specific proposals that the hon. Member advanced.
I remind the House that I and my colleagues from the west midlands have been seeing all the economic Ministers in the past 12 months about the problems in the region. Because the hon. Member for Coventry, North-West deliberately ignored it, I shall mention the specific assurance that we were given about the import of Spanish cars. We were told that, if agreement was not reached through EC channels, unilateral action would be taken within three months. I take that to be a recognition of the discrimination against Britain through grossly inequitable tariffs, to which my right hon. Friend the Secretary of State for Industry drew the attention of the public in October 1982.
That assurance is most important to the west midlands. It would also help with the competition from tied imports. Opposition Members may talk about import controls, but the increase in imports, as they should be aware, is largely in tied imports—the so-called in-house manufactures from the big multinationals such as Ford, General Motors and Talbot. In 1975, tied imports represented 1·5 per cent. of registrations, whereas they were 22·5 per cent. last year. That is where the growth of imports has come from. The Spanish action would be a great contribution to that problem, never mind the threat from the new Vauxhall car.

Mr. John Spellar: As the hon. Member has rightly said, in October, during the Northfield by-election, the Minister said that control of Spanish imports was firmly in the action file. That is now four months ago. When can we expect action?

Mr. Miller: The assurance was given by the Minister shortly before Christmas. We are still acting in accordance with that timetable. I should be happy to give the hon. Member the reply in the form in which we received it and as it was reported in the press.
The hon. Member for Coventry, North-West conveniently forgot that the problem of the west midlands was forecast by the economic planning committee and its predecessors as long as 20 years ago. There have been several Labour Governments since then. The unemployment that is now so tragically taking place was forecast because of the region's unique and continuing dependence on manufacturing industry for employment and its concentration on only five industrial sectors. The world recession, accompanied by the change in industrial production patterns and demand, inevitably led to the circumstances that we have been experiencing.
The region has the lowest output per capita in the country, the most adverse industrial structure and a high proportion of derelict land. Some 33 per cent. of the land


earmarked for development in the region is now derelict. All that, coupled with the highest rise in unemployment in the country, means that the region would normally qualify for regional assistance. I am not surprised that the hon. Member for Coventry, North-West put that first in his recommendations, and he will not be surprised that I fundamentally disagree with that recipe. It is a reversion to the old Socialist habit of throwing money indiscriminately at the problem without bothering to get to the root of it.
I am glad that the Government are undertaking, at long last, a fundamental review of regional policy. The case that regional policy has led the creation of new jobs rather than the diversion of jobs from other regions or that regional policy is a cost-effective way of providing jobs is far from established. I hold the same deep-rooted suspicions about enterprise zones with regard to diversion of businesses and discrimination in competition.
As we heard the proposals of the hon. Member for Coventry, North-West I remembered the tired old proposal of national planning. No doubt he will recall planning agreements. Perhaps he remembers that which was concluded with Chrysler. It did not stop the onward march of change. It is like King Canute whose advisers imagine that they can turn the tide of change and progress by Government decree. That is absolute nonsense and the Opposition know it. They know that it contributes nothing to the change in the structural basis of the region—which, to be fair to the hon. Gentleman, he came to at last.
We need new products and technologies in the region. One of the most disturbing things at the moment is the low take-up of the plentiful Government assistance that is available to support the innovation programme in the region. Applicants from our region represent only about 10 per cent. of the whole. In the long term, unless something is done about that by industry—the Government have already made the money available—we shall lag further behind. That is a serious threat, which no amount of planning agreement or regional assistance will solve.
The innovation package—part of the competition package that I presented to the House some 10 days ago during the debate on regional unemployment—recognises the need to improve our technological base in the region. That is why I strongly welcome the recent announcement by my right hon. Friend the Secretary of State for Education and Science to increase the number of research assistants in science and technology projects in universities. That will go a long way to correcting action that was previously taken—

Mr. Peter Snape: Like Aston?

Mr. Miller: Especially at Aston university. Apart from the need to develop our university effort, we must seriously consider the proposals made by the vice-chancellor of Aston university for the institution to bridge the gap that still exists between the university and industry. I hope that that will be considered when it reaches the appropriate ministerial desk.
We must also increase spending on research and development and improve co-ordination of research and development effort. That has not been as prominent in the region as it should have been. One of the problems with

take-up of the schemes and further investment in research and development by firms in the region is the fact that their balance sheets have become weakened to the point where the downside risk is too great.
I hope that some thought is given to easing the problem by Government participation, either through the tax system or by setting a floor to the down side risk on a research and development project so that the risk can be shared between the Government and the firm. It is better that research and development should be undertaken by firms that have a commercial use for it and a commercial understanding of the possibilities rather than by Government institutions.
The hon. Member for Coventry, North-West made great play of the needs of the components industry. I also believe that the components industry is in a gravely weakened state and that the Government's assistance so far has been given to assemblers and not to component makers. However, I am glad that, in answer to a question that I asked earlier this year my hon. Friend the Member for Coventry, South-West, the Under-Secretary of State, made it plain that the Government were willing to support applications under the existing product and process development scheme from component firms. I understand that discussions on such proposals have already taken place and that they will be considered favourably if they meet the criteria. Therefore, the Government have moved to meet that problem. We are waiting for a response from firms in the region.
My right hon. and learned Friend the Chancellor of the Exchequer is about to make his Budget judgment. It will come as no surprise to hon. Members to hear that I believe that the Budget judgment must be in favour of those who work in industry. I should like to see a heavy indexation of the tax threshold, accompanied by a further attack on industrial costs. The discrimination against our industries, which are told all the time to become more competitive, still exists in the shape of the national insurance surcharge. Compared with our competitors abroad, our industry still suffers from an unparalleled rate burden. The councils that are dominated by the Labour party have done a great deal to aggravate that.
What better example is there of profligate spending and chucking money at the problems than the West Midlands county council bailing out with ratepayers' money foundry industries that have been unable to compete, thereby weakening the industries that are trying to remain in business? The burdens of the firms that are struggling to remain in existence have been increased. That is a typical Socialist solution, which has aggravated the problem rather than provided an answer. Industrial costs need to be attacked further. Our firms are still competing on an inequitable cost basis with those abroad.
We do not need special measures for the midlands. What is good for industry is good for the midlands. The Government are not yet seen in the country as understanding industrial problems—

Mr. J. W. Rooker: That is the only sensible thing that the hon. Gentleman has said so far.

Mr. Miller: Honesty is apparently foreign to Labour Members.
The Government are not yet perceived as understanding industrial problems, although I have shown tonight that


they have taken many measures to meet the problems that I have outlined. That is why my hon. Friends and I have urged the Government to present a competition package putting together all that is being done, which is not yet understood. I am confident that we do not want to run down the west midlands by depicting the situation there as worse than it is, which would only further reduce morale and drive away any hope of investment or improvement.

Several Hon. Members: rose—

Mr. Deputy Speaker (Mr. Ernest Armstrong): In view of the large number of hon. Members who are waiting to speak, I must inform the House that the debate will finish at 9.58 pm, so some restraint would be helpful.

Mr. Gwilym Roberts: I also welcome the opportunity of a further debate on unemployment in the west midlands. It may surprise some of my colleagues when I say that such a debate should be carried out with as little partisanship as possible. The problem is so serious that we need to find as much common ground as possible so that we can see whether we can find a solution.
There is some truth in the argument that the problems of the west midlands did not start with the present Government. They have grown much worse during their period of office, but we would be foolish if we argued that all the disasters started in May 1979. In the west midlands, underlying problems affected-industries long before that.
In such debates as this, we return to the same ground. The arguments seem to be the same. The only difference is that the situation is becoming perpetually worse. My constituency has all the problems of the west midlands, only worse. As many hon. Members will know, unemployment is about 22 per cent. in Cannock. There is a small population, but 6,000 people are unemployed. Many school leavers who left school last summer have not yet found real jobs. Many are unemployed and many others are in various schemes. As hon. Members on both sides of the House know, only about one in six of those who embark on those schemes have a chance of finding a real job. Therefore, there are real problems. In a brief debate like this our task should be to try to find some real solutions.
I shall give Conservative Members one serious word of warning. I accept the argument of my hon. Friend the Member for Coventry, North-West (Mr. Robinson) that the Government's basic policies have made things much worse. The Government's policies, unlike those of their predecessors, have deliberately led to the destruction of jobs and the rundown of industry. There can be no doubt about that. There has been a hope that, by destroying some of the older industries, one can restructure industry. We all accept that, while we have oil, we will have some shelter in these desperate years. It will last perhaps 15 or 20 years.
There is a desperate need to revitalise British industry, particularly in the west midlands. The Government have tackled one part of the package. They have run down some of the older and less efficient industries. However, the sad thing is that they have failed to produce the alternative employment and sunrise industries to replace them. The output of British manufacturing industry is now at its lowest for about 17 years. That is the indictment of the Government.
Many industrial manufacturers have voted Conservative solidly, all along the line. They supported the Government in the belief of a revival. There is now evidence that since the beginning of 1983—some Conservative Members will agree—people no longer believe in that revival.
Some large industries which kept their work force in the hope of better things to come are now thinking of ways of reducing their excess labour because they no longer believe in the revival. Many small firms in my constituency have had contracts with large firms but they are finding that those large firms are giving up those contracts because they no longer believe in the recovery about which the Chancellor and the Prime Minister have been telling us since 1981. Industry sees that recovery is not coming, and therefore it is less active. That is dangerous, not just for the Government but for the country. It means that in 1983 we may see a much sharper rise in unemployment and a greater rundown of industry than we have seen during the past couple of years. The position is serious for British industry.
It is difficult to suggest remedies. I shall appeal to the Minister on a constituency basis. The one thing that would be helpful in my constituency would be the speeding up of new developments in the coal industry. Will the Minister convey to his colleagues at the Department of Energy and through it the National Coal Board that if there is to be a revival new pits are desperately needed in constituencies such as mine? Recovery in a constituency such as mine depends upon recovery in the west midlands, which in turn depends upon recovery in the country generally.
I believe that we must have some selective import controls if there is to be any hope for industry in tie west midlands in years to come to allow it to compete with industries in other parts of the world which have benefited from large capital investments.
I agree with the suggestion by my hon. Friend the Member for Coventry, North-West that the Government should bring together the major west midlands industries to see whether they are prepared to accept industrial planning. I understand that the West Midlands county council has already taken some steps in that direction. It needs Government support.
I agree with the hon. Member for Bromsgrove and Redditch (Mr. Miller) that the west midlands does not want assisted area status. I was absolutely horrified at the suggestion by my hon. Friend the Member for Coventry, North-West to designate the west midlands metropolitan county an assisted area. What will happen to an area such as mine that borders this metropolitan county? Assisted areas provide jobs only at the expense of other areas. It is as simple as that. It is no answer. The answer must be a co-ordinated plan to bring major industries together.
Some Conservative Members might not agree with me that there is a need for selective import controls. British Leyland should be consulted about that. In the past British Leyland has bought some of its components from overseas. The House has shown its support for the workers of British Leyland and British Leyland must show its support for the hundreds and thousands of component workers in the west midlands who depend upon it. I accept the suggestion of my hon. Friend the Member for Coventry, North-West that there is a need to bring people together in the west midlands to study some kind of development plan.
The only real answer to the problem, not just for my constituency but for the west midlands and the country, is a vast increase in public expenditure. Public expenditure creates demand. Conservative Members are exponents of the market economy. They know that the key to the market economy is the creation of consumer demand. There is a desperate need to increase public expenditure in the short term and for investment in capital projects in the public sector. It will create jobs and generate demand in the economy.
It is only with such policies that there will be any hope for people in my constituency, for the west midlands and for the economy generally.

Mr. David Gilroy Bevan: My constituency is only 148th—what a terrible way to put it—in the league table of unemployment statistics in the Library. It is not the highest in Birmingham, but it represents a significant number of people. At the time of the census, about 15·7 per cent. of males between 16 and 64 were unemployed. It is in the upper quarter of the statistics. It is a wholly new experience for a midlander who has never been at the top of such a table.
The MSC figures are based on travel-to-work areas. They show 118,000 claimants and about 16·6 per cent. of unemployed males, 3 per cent. higher than the national average. When Parliament convened and I was first honoured to be a Member in May 1979, west midlands unemployment was 5·7 per cent., which was a lowish figure. In the two and a half years to October 1981, there was an explosive deterioration and the figure rose to 16·6 per cent. That is the criticism of the Government. However, as hon. Members have said, the criticism is not levelled solely at the present Government. It is not a matter for party politics or bickering. We should analyse where the creative development areas are.
Birmingham was once a city of a thousand trades. It is now, regrettably, a city of far fewer. The city has always been dependent wholly on the metal-bashing industries, general engineering and car manufacturing. Those industries have always been important for employment trends in the area. With the reduction in manufacturing and the work force at British Leyland, we are seeing an internal geographical movement of manufacturing industries and the tilting of a loaded manufacturing gaming table. We witnessed it first in the closure of the Rover plant at Solihull and the internal shifting of the manufacturing centre to Cowley. We have seen it in many sectors, especially in the motor components industry. The ingredient of success in Birmingham and the west midlands now is for the engineering industry to be succoured and for British Leyland to find the success that it needs, especially with its lifeline, the Austin Metro and its derivatives. In a turbulent industrial sea, that lifeline is being threatened by the mountain of tariffs around the Spanish coast, especially Spain's direct tariff of 35 per cent. That tariff barrier, aggregated up with many other figures, brings us to well over 60 per cent. That is what it costs to get one Metro from Birmingham into Spain.
Britons must consider whether we should put up with that iniquity whenever we are fortunate enough to buy a new car. The multinational companies, such as Ford, Vauxhall and General Motors, must consider whether they

can subscribe to those policies. The subscription to those external policies has caused a socio-industrial revolution, without bullets or barricades but with the soft shoe shuffle of planners internally and multinational companies externally. We have witnessed those events and we especially appreciate my right hon. Friend the Prime Minister's assertion that she will take unilateral action. We shall look to the Ministers to whom we have submitted our considerations for such action to be taken quickly to protect the Birmingham car industry.
Hon. Members on both sides of the House are horrified by the gravity of the position in Birmingham and the west midlands. In Tyesley in my area, 1,250 workers were affected by the proposed closure of the Lucas Girling works. It was said that 550 would be made redundant and that 500 would be redeployed. A further 1,250 workers were affected the very next week by the proposed closure of Lucas Girling. Where will those redeployed workers go? Birmingham has better skills and has plants equal to any others in Britain. Those redeployed workers will be moved to assisted areas such as Cwmbran, Pontypool and Scotland. Those areas are still attracting perks such as low rents, grants, capital allowances and all the other benefits that were begun by the coalition Government of 1945 and proposed by the then president of the Board of Trade, Mr. Hugh Dalton. Those benefits, which were intended to be temporary palliatives, have become permanent features and they have enfeebled the strong west midlands and Birmingham at the expense of strengthening the weak.
The process continues automatically. In the climate of evanescence—of disappearing to other pastures and places that originally existed in the west midlands and to which a son of Evan does not wish to subscribe—we must ask for more than specific sector aid and for more than the support that hon. Members on both sides of the House agree is necessary. The 10 per cent. car tax must be wiped out and national insurance must be abated substantially or removed altogether. There must be a reduction in rates, and if possible, a reduction in energy charges to industry, and we must ask for other benefits besides.
It does not matter whether Birmingham is called an assisted area. We need financial assistance in the west midlands to ensure that jobs remain in the area and that firms remain manufacturing entities. Although my right hon. Friend the Prime Minister and her colleagues in Cabinet have started to roll back the areas with assisted area status, they still exist and attract industry away from the west midlands. While that is happening, we must ask for equal general support for industry in Birmingham—the iron heart and the manufacturing centre of Britain—so that we can continue to offer jobs.
It is understandable that, when workers are offered redundancy payments, they will eventually reach out and take them, if they are significant amounts. They will take them, as did the dockers, the miners and the car workers, because they are the only alternative. Of course, many of them have entrepreneurial skill. One of my constituents in Tyesley took his early redundancy money from a bakery and started a baker's round with it. He is doing well and has more orders than he can handle. When there is no alternative, the workers of a threatened industry will take the redundancy money because it is their only chance.
There is continual erosion because of this silent socio-economic change and, with that erosion, there is an absolute necessity to set matters right. In singling out the Government for criticism, we must remember the


Government of 1945 and the Socialist Government of 1947, who brought in the industrial development certificates that were removed only about two years ago by the present Government. Those certificates prevented firms in the west midlands from expanding—from putting one brick on top of another—and from making substantial developments to their factories, and forced them to look elsewhere to places with other attractions.

Mr. Rooker: Will the hon. Gentleman give way?

Mr. Bevan: I should prefer not to, but I shall.

Mr. Rooker: I am doubly grateful to the hon. Gentleman. Did the imposition of industrial development certificates or the other matters that he has just mentioned prevent him from keeping his promise to get together a consortium of business men to save the Rover plant at Solihull? Is that one reason why he was not an entrepreneur?

Mr. Bevan: I am grateful for that question, although I had hoped that the debate would not lead to party bickering. The initiative for which I was asked to speak could not be successful. One reason for that was the size of the rates bill for that factory in Solihull [Interruption.] The hon. Member for Birmingham, Perry Barr (Mr. Rooker) laughs, but three years ago the rates bill for the main assembly shop was nearly £1 million. The bill for the paint shop was £350,000, and the precept from the West Midlands county council contributed to those rates charges. It would have been prohibitive for an industrialist to take on that factory. Industrialists call for a reduction in rates and in power charges. Birmingham has more than 1 million sq ft of unoccupied factory space. One tenth of that amount around Small Heath, Greete, and Tyseley is still priced at 50p per sq ft, with no takers, because the rates for the areas being offered at 50p per sq ft are based on calculations of £1 per sq ft.
Therefore, we must look for general support. We must look for new answers. We must look to the Front Bench to support the thesis of support, to support new industry and low rating. Although Opposition Members may not like it, the high wages in the public sector disadvantage workers in the industrial sector.
There must be a case, surely, not only for the excellent youth opportunity scheme but for a scheme of national service, whether industrial, social, the voluntary decision of the individual or military to take up the young.
I am certain that the west midlands patient, having been subject to substantial surgery, sometimes intended and sometimes unintentional, must now be put into intensive financial care by the Government. I therefore support the opposition to the terminology of the hon. Gentleman's criticism of the Government.

Mr. George Park: Today's debate is an "inaction replay" of the debate which took place on 4 December 1981 when my hon. Friend the Member for Walsall, North (Mr. Winnick) won a place in the ballot and chose the same subject. It is a sad commentary that we have to rely on the result of a raffle to highlight again the extent of the disaster that has fallen on the west midlands and have to try again to spur the Government into doing more than utter sympathetic noises.
The companies that I named in that previous debate have continued to go downhill, but so that I will not be accused of trying to attribute all the unemployment to the term of office of the present Government, I will start in 1975. In Coventry since 1975 19,000 jobs have gone from British Leyland; 7,000 jobs from GEC; 6,000 from Talbot; 4,600 from Tooling Investments; 2,300 jobs from Dunlop and 1,300 jobs from Courtaulds, to name but a few. In total during that time, 47,000 jobs have gone and there are more in the pipeline.
Since July 1982 there have been 13,500 announced redundancies from 69 companies in the west midlands. You will note, Mr. Deputy Speaker, that I said "announced redundancies", which means that redundancies of 30 or fewer are probably never mentioned. Last year in Coventry alone 4,500 people lost their jobs. In the same period, 25,500 people were sacked in the metropolitan county area. In my constituency, unemployment is 22 per cent. How many more jobs have to go before the Government stop saying that overmanning is a major issue? Do we have to grind to a complete halt before the Government recognise that the industrial lifeblood of the heart of England is draining away?
Behind these cold statistics lies a tale of human despair, waste and frustration throughout the age range. Each year the job market shrinks for the school leaver. My hon. Friend the Member for Coventry, North-West (Mr. Robinson) told the House that, of the fifth formers who left schools in Coventry last year. 86 per cent. had no job to go to. Of the sixth formers, 84 per cent. had no jobs. The statistics show that the more disadvantaged the school leaver, the worse off he is. Of school leavers from special schools, only one found open full-time employment. How are parents and teachers expected to maintain enthusiasm and a responsible attitude to life from youngsters in those circumstances? There are today more unemployed under the age of 25 than were unemployed in all the age groups on the day the Government were elected. Men and women in their late 40s and early 50s are increasingly being told that they are too old, and for those already out of work for more than a year, the DHSS is creaking under the weight of the claims and is rarely able to abide by the regulations on claims.
We are seeking in the debate not merely a recital of facts that should be only too well known to the Government, but some positive sign that they are prepared to tackle the problem. I know that the Government will tell us about the various schemes, but all my hon. Friends and I can say in reply is that they do not seem to have made any impact so far, and confidence is draining away.
The Government could take some action. For example, there is divergence of opinion about making the west midlands an assisted area—a divergence of opinion that has been voiced in the debate. The Government could agree to inner urban area programme authority status, which Coventry has been seeking since 1978. Coventry has had no reply so far. The West Midlands county council supported Coventry and also supported Walsall and Sandwell for programme authority status. Such status would give us access to EC funds. Investment incentives could be reintroduced to help companies to retool, which would help the machine tool industry and equipment suppliers. The additional car tax and the payroll tax should be removed. Energy costs for industry could be reconsidered. Further money could be made available for the small firms investment scheme.
The Under-Secretary of State, in reply to a letter from me, said that the Government could not operate an open-ended scheme. I can appreciate that, but it is clear from the demand when the scheme was introduced—the Government then added money to it—that there is a pent-up demand and that the scheme rang bells with small firms. The Government should reconsider the position.
The hon. Member for Bromsgrove and Redditch (Mr. Miller) referred to unfair tariffs. He may have had a promise but nothing has yet happened. Positive steps must be taken to eliminate or counter these discriminatory tariffs against our exports. Where public money is invested, there should be a requirement to buy British. Other countries do not seem to have a problem with this principle.
The problem of void rating could and should be dealt with nationally. We should not have the spectacle of industrialists ripping the roofs from factories. What effect will that have if and when there is an upturn? Consideration should certainly be given to grants for the clearance of old factories. Such grants should be increased for clearance in city centres. One can sit in the CBI offices in Birmingham and look out on to acre upon acre of old, derelict factories that should be cleared. If clearance took place, there would be the equivalent of green field sites and it would not be necessary to impinge upon farm land. That is something that could be done.
If anyone thinks that no initiatives have been taken he should remember the science park at Aston, the science park at Warwick university, the development agencies, the unit factories and the new enterprise workshops. I could recite the entire list, but time does not permit me to do so. It cannot be said that we are sitting on our hands and waiting for the Government to do everything for us.
There is a crying need for Government action on a scale which we cannot initiate locally if new hope is to be given to the west midlands and its constituent parts. I urge the Government not to waste time on the irrelevancy of privatising Jaguar but to stem the haemorrhage in industry and provide us with a much-needed transfusion by adopting any or all of the suggestions that I have made. Time is not on our side.

Mr. J. F. Pawsey: I hope that the hon. Member for Coventry, North-East (Mr. Park) will forgive me if I do not follow him too far down the road that he signposted. The hon. Gentleman spoke with his usual sincerity. When he speaks in the House he is always listened to with great respect.
Between 1979 and December 1982 unemployment rose faster in the west midlands than in any other region. It is the only area where the number of those unemployed has literally trebled. In May 1979 the west midlands was eighth in the league table of unemployment. In December 1982 it had taken fourth place after Northern Ireland, the north and Wales. This is the first time that the west midlands has suffered unemployment on this scale. That makes the situation even worse as the region has moved from comparative affluence to real depression. It is difficult to avoid the conclusion that the region has to some extent contributed to its own difficulties. Faced with this situation, two questions must surely be answered. First, what are the reasons for the decline in the west midlands? Secondly, what can be done to improve matters?
No examination of the causes can be complete without reference to the motor industry, which for years has been the principal employer. That can be said not only of the great motor plants of Coventry and Birmingham but of ancillary companies such as Dunlop, Lucas, Lockheed and Girling. There is also the host of small engineering companies that is involved in the production of tools, jigs and fixtures and the companies that supply the parts that go into the manufacture of a motor car.
The motor industry continues to be in decline. It seems that there are four basic reasons for this. First, there is the record of strikes, lost man hours and low productivity. Secondly, there have been some poor management decisions. Thirdly, there has been Government interference. Fourthly, there has been the impact of imports, especially from Japan, Spain and the EC.
In 1973 industrial disputes totalled 297 separate stoppages which involved 441,000 employees. The number of days lost in that one year was 2,082,000. Even as late as 1979 there were 165 separate stoppages involving 367,000 workers with over 3 million days lost. That is what I mean when I refer to the west midlands having contributed to its own difficulties.
Disputes are self-inflicted wounds. Throughout the 1960s and 1970s the motor industry increasingly lost its reputation for both quality and quantity. Its work force had the unenviable reputation of being prepared to strike for the most trivial reasons. Labour relations were appalling with misunderstandings and suspicions being generally the order of the day. Restrictive practices were legion and over-manning was rampant. It is a fact that in the British motor industry twice as many workers were needed to produce the same number of cars as their counterparts produced on the continent. Too often trade unions refused to accept new methods or new ideas to improve productivity. They preferred to live in some fool's paradise in which wages increased by 316 per cent. between 1972 and 1982 and in which productivity during the same period increased by only 25·3 per cent.
That in a nutshell is one of the reasons—perhaps the principal reason—why the region, a part of which I represent is in such decline.
Secondly, senior management has made many mistakes. It is difficult to justify the original concept of British Leyland. The hon. Member for Coventry, North-West (Mr. Robinson), who opened the debate from the Opposition Front Bench, recognised that Leyland grew under a Labour Government. That was one of the points that he made especially well. But in effect, management decided to abdicate control of its own plants and sought to buy peace at any price. I believe that to be a real indictment of British management techniques.

Mr. Percy Grieve: We all recognise that there is great truth—

Mr. Les Huckfield: Who is this?

Mr. Grieve: —in the catalogue of failure to which my hon. Friend has alluded. However, does he agree that there has been a great change in the management of the motor industry, especially of Leyland, which is manifesting itself today in considerable achievement?

Mr. Pawsey: I readily concede that. I am seeking to draw the picture in the round and to give the reasons for our industrial decline. It is no good anyone pretending that


we can halt and reverse industrial decline in only three years. The faults of the past cannot be put right in such a relatively short period.
Thirdly, successive Governments have grossly interfered. This was best illustrated by the way in which hire purchase was used as a regulator. Governments moved hire purchase deposits up and down and showed a complete lack of understanding of the realities of mass production. Successive Governments appeared to think it possible to turn production on or off like water from some pre-dispute tap.
Finally, imports, especially those from Japan and Spain, have made enormous inroads into the domestic market. Japan must be recognised as a substantial threat. It holds between 10 per cent. and 12 per cent. of the United Kingdom market. An even greater menace than Japan is Spain, which is taking advantage of great tariff differentials. It is time that Britain got to grips with the competition and started playing it at its own game and under the rules that it invented.
I referred to Government interference. It appears that, for the best of reasons, all Governments wish to interfere. It is evidently a fact of governmental life and is presumably hewn on tablets of stone somewhere in Whitehall that everything gets better providing that there is more Government interference. I have formulated Pawsey's law of interference: "Nothing is so bad that it cannot be made worse by positive Government interference." Like the way to Hell, the way of Government is paved by good intentions.
Regional policy is a good example of this attitude. Has it really any worth in today's climate? At a time of depression, existing jobs are simply being moved from region A to region B—a type of musical chairs, except that it is played not with a diminishing number of chairs, but with a diminishing number of jobs. Regional policy has done nothing for the west midlands, but has presided over the movement of factories, for example, from Coventry to Linwood. It has distorted the production infrastructure and weakened the motor and component industries, and has not even provided long-term jobs to those regions that it sought to help. Anyone who doubts that should go to Linwood to find out for himself.
Government interference is more than regional policy and industrial development certificates. It includes other measures, ranging from job protection to health and safety at work legislation, all introduced for the best of reasons, but all blunting our competitive edge.
I do not seek to argue that all Government interference is bad. We must not ignore the enormous sums that have been provided for the motor industry—over £1 billion to British Leyland alone. Most of that money has been spent in the region, although it should be regarded not so much as regional aid, as sector aid. Rolls-Royce has received over £500 million since 1979. The west midlands has received support and the Government have put their money where their mouth is. Clearly, more remains to be done.
I have long argued that there are at least two fiscal measures that would help the motor industry. The first is the removal of the 10 per cent. car tax, a tax that unfairly discriminates against the motor industry, and a penalty that distorts car purchases in the United Kingdom. If that tax were removed, more new cars would be purchased. I appreciate that about 50 per cent. of those cars would be imports, but none the less the balance of sales would still

provide a major shot in the arm for our car industry. The hon. Member for Coventry, North-West may disagree with that, and if he does, let him stand up and tell us why. Let me hear him argue the case in favour of the 10 per cent. tax.
The second measure would be to exclude company cars from VAT. According to George Turnbull, president of the Society of Motor Manufacturers and Traders, 70 per cent. of company cars are British. If, therefore, additional incentives resulted in the more frequent purchase of company cars, that would provide an important boost to our domestic motor manufacturers which would, in turn, lift the region.
It might be appropriate for me to say here that the problems that I outlined earlier were not of this Government's making, but had developed under successive Governments. As the hon. Member for Cannock (Mr. Roberts) said, unemployment did rot start in 1979. It has been rising steadily under successive Governments. It is worth while remembering that under the Labour Government, unemployment doubled.
What is new is the world recession—[HON. MEMBERS: "Oh."] Hon. Members may moan and groan, but if they listen they will discover why I make the point about the recession. They represent, as I do, the west midlands and should know that it is export orientated because so many of its products go abroad. It is because of this fact that our region has felt the draught of depression more than most.
Action has been taken. It would be erroneous to assume that the Government have sat on their hands. They clearly have not. The Government have done a great deal and will do more. For example, industry demanded lower interest rates and lower inflation and has had both. That will create a climate in which a recovery can develop. It is worth remembering that the base rate has been reduced by 5 per cent. since October 1981. That is worth about £1,750,000 to British industry in a full year. Inflation is now at about 5 per cent., which is invaluable to the exporting industry of the west midlands and specifically to companies in my constituency such as GEC.
As the inflation rate has fallen, it has been much easier for these companies to quote and secure orders throughout the world. That shows just how successful have been the measures that the present Government have taken—measures that will positively assist our region and our nation. It is no good hon. Members shaking their heads or seeking to deny the facts. They do not like the truth, but tonight they will have to listen to it.
Recent trade union legislation will do much to restore a proper balance in industry—a balance that has become grossly distorted in favour of organised labour, again to the detriment of industry. The Government promised help to small firms, and that help has been given—[Interruption.] The Government have improved the tax climate, reduced bureaucracy and provided more advisory services. My next statement gives the lie to the laughter of Opposition Members. More small firms are being formed than ever before in this nation's history.

Mr. John Spellar: Is it not also true that there is a record number of bankruptcies in the courts?

Mr. Pawsey: Yes, and that is a fair point. I am always prepared to admit the truth when I hear it. The hon. Gentleman has drawn my attention to the number of bankruptcies but he might have been a little more honest


had he stressed the importance of the new companies that have been started and that are generating more work and more jobs. That is what should excite the hon. Gentleman's imagination. He should look forward instead of back. Another facet of Government aid is the great number of people in the west midlands who are now benefiting from the Department of Employment's programme of training measures. The figure ranges from 10,700 people on the temporary short-time working compensation scheme, to 6,600 who are taking advantage of the job release scheme. The number also includes almost 80,000 young people in youth opportunity programmes. In addition, the experimental enterprise allowance scheme in Coventry has undoubtedly proved successful. I pay tribute to the Under-Secretary of State for Industry, my hon. Friend the Member for Coventry, South-West (Mr. Butcher), who has taken particular note of the scheme, and I very much hope that it will be expanded.
I should also like to see the urgent resumption of the imaginative small engineering firms investment scheme. This point was touched on by the hon. Member for Coventry, North-East and I fully agree with his comments. It has proved to be a considerable success and the £30 million allocated to it was taken up in 12 weeks. The majority of that money went into the west midlands and is now helping our small companies to re-equip and retool so that when the country moves out of the recession, they will be in a position to take advantage of the improvement that takes place.

Mr. Les Huckfield: When is that?

Mr. Pawsey: When the Finance Bill is introduced in March, I hope that it will contain a reference to the resumption of that scheme and in a much expanded form.
Yet, despite all that, it is a mistake to assume that Governments hold all the answers to unemployment. So much could be done if each man or woman, before making a purchase, found out the country of origin and, where possible, bought British. Too often we find ourselves purchasing foreign goods when a sound British alternative exists. It is almost as if it has got to be foreign before it is good, and the cost of that principle is measured in factory closures and job losses that range from steel in Dudley to motor cars in Coventry.
I shall illustrate that point. In the first nine months of 1982, 58 out of every 100 cars bought in Britain came from abroad. According to the Confederation of British Industry, if we had kept the share of home and international markets that we had 12 years ago, there would be 1·5 million more jobs in the United Kingdom. That shows just how much market share we have lost and how much emphasis we should place on supporting our home-based industries.
The recipe for renewal is a mixture of Government measures and self-help. The west midlands still has the benefit of its people's skills, good communications and inventiveness. Our people will have a go and, as the business and industrial climate improves, so will our fortunes. But Government must start the engine of renewal.

Mr. J. W. Rooker: The speech that we have just heard did not have much content, but it was remarkable, because the hon. Member for Rugby (Mr. Pawsey) made some positive points. The contrast between his speech and those of his two hon. Friends was astonishing. All that I can say about the hon. Member for Birmingham, Yardley (Mr. Bevan) is that he will not be able to make such speeches in the next Parliament because he will not be back here.
I am sorry that my hon. Friend the Member for Cannock (Mr. Roberts) is not in his place, because I disagree with bipartisan twaddle. I was not sent to this House to do deals and to be nice to Conservative Ministers who are putting thousands of my constituents on the dole. That is what is happening in the west midlands now. It is no good saying that we must not be party political. If we cannot be party political in the House of Commons, where can we be party political? That is why we are here. We are elected to represent and articulate the needs and problems of our constituents. The fact is that in 1983 the biggest single problem in the west midlands is this Tory Government. There is no equivocation about that, and certainly there should be no equivocation on this side.
I do not claim that there was never unemployment before May 1979. Clearly there was. In 1979, it was 5·7 per cent. in Birmingham. Last October it was 18 per cent. That was before the Government used the new fiddled figures. So it went from 5·7 per cent. to 18 per cent. It is true that there was unemployment before 1979, but it was not mass unemployment. That is what we have today.
The economy of the west midlands is unique. I do not say that one region should have more unemployed than another region. I have not fallen into that trap, either in this House or outside. Because of its historical background, the structure of business in the country, and the nature of the beginning of the industrial revolution, the west midlands economy, by and large, is heavily dependent on metal-bashing industries. That is one thing that the hon. Member for Yardley said. There are eight industries—metals, metal manufacturing, engineering and electricals, and vehicles, coupled with construction, professional services, the distributive trades, and the odd miscellaneous services.
Two thirds of the west midlands labour force depends on those eight groups. Over the past few years five of the eight have been more in decline than in advance. Because of this element of dependence and because of the structure of our industry, when external economic pressures are applied to our region, whether because of the present depression, which has been brought about and substantially added to by Government policy, or because of the world depression, or, for example, the three day week, the effect on the local economy is greater than in other regions.
It is for that reason, as the hon. Member for Rugby (Mr. Pawsey) said, that unemployment in absolute terms has trebled under this Government. Under this Government, the big attack has been on manufacturing and industrial output, and because of the nature of our economy we have been harder hit.
I shall give one statistic to illustrate what I have said. Nine years ago this country was on a three day week. Between December 1973 and January 1974, because of the effect of the three day week and the cut in power


generation, there was a 560 per cent. increase in unemployment in the west midlands. The average for Great Britain was 207 per cent. We had the highest increase in unemployment during the period of the three day week because of the external pressures applied, in power generation and so on, to the manufacturing base of the country. It happened during the three day week, and exactly the same has happened during the past three years, because the attack has been on manufacturing industry. Those who say anything else fail to take account of reality.
I do not wish to give too many statistics, but one cannot make the case without mentioning some. On the third anniversary of this Government last summer, manufacturing output was 15 per cent. down on the same period in 1979. The CBI's response was to say, "Be bolder with safety." By November 1982, industrial output was 19 per cent. below that of 1979. One in five jobs had disappeared. According to information produced only last month, industrial output was at its lowest level for 17 years. A headline in the Financial Times on Wednesday 19 January read:
Manufacturing activity at its lowest level for 16 years.
In The Times, the headline was:
Industrial output slides to lowest level for 17 years.
I understand the technical differences in assessing industrial and manufacturing output. However, whether it is at its lowest level for 16 or for 17 years, that is the reality. Anyone who argues that this state of affairs is due to the world recession cannot have examined what is happening in the world. Between the second quarter of 1979 and the third quarter of 1982, output in the Common Market countries dropped by 6 per cent., in the United States by 9 per cent. and in the United Kingdom, excluding oil, by 15 per cent. Even if oil is included, output fell by 11 per cent. whereas in the OECD it fell by only 4 per cent. During the same period, output in Japan increased by 14 per cent. We have done much worse than the rest of the industrialised world.

Mr. Beaumont-Dark: The hon. Gentleman makes one mistake. Inflation in this country was by far the highest in Europe. The pains of curing it have therefore been so much greater.

Mr. Rooker: That has been the Government's main argument since they came to power If it is true, we should have been seeing last year the beginnings of a fantastic upsurge in employment. The remarks of Mr. Steve Rankin, the west midlands chief of the Confederation of British Industry in September 1981, led to a headline in The Birmingham Post stating:
Jobless figures may be near peak, industry chief believes.
There are now another 20,000 or 30,000 unemployed people in the west midlands. Where are the new jobs coming from?
It will be interesting to hear what the Minister has to say. The hon. Gentleman will have to put some flesh on the remarks of the hon. Member for Bromsgrove and Redditch (Mr. Miller) about the Prime Minister's pledge. The Minister will have to put on record what the Prime Minister stated. We cannot be left with an account of private discussions between an hon. Member and the Prime Minister. There has to be some accountability to the House of Commons so that our constituents know the Government's position. Is it the case that the Government, by the end of March, have to deliver on the issue of sanctions against Spain?
It is from the Opposition Benches that the call for this debate has come. I wish to draw attention to the demise of a number of jobs in particular companies in the west midlands. It is not only the recession in Britain that has brought that about. I want to highlight one or two other factors. I must go back to before the Government took office and I shall use figures taken from the Financial Times on 9 December 1982 from a first-class article on the shape of the shake-out and the effect on jobs and Britain's leading exporters. That article gave employment figures for the period 1973–1982 but I shall take those for 1977–1982 because they give the fairest picture of what has happened in the last few years.
British Leyland dropped 91,000 jobs—53 per cent. All the companies have a strong base in the west midlands. They are household names in the west midlands as well as national names. Lucas Industries dropped 19,000 jobs—28 per cent. of its United Kingdom employment. During the same period Lucas Industries took on new people in its overseas factories. As a proportion of Lucas Industries' worldwide employment, jobs in Britain were decreasing while those elsewhere were increasing. The same can be said of GKN. That company dropped 33,000 jobs—45 per cent. of its British work force. Over the same period the percentage of its British work force out of the total dropped from 67 per cent. to 54 per cent. It was taking on workers elsewhere.
It is well known that we are receiving imports from our own companies. Those imports are not just fully assembled motor vehicles. Lucas Industries is a classic example. Years ago one could walk round the shops such as Halfords and buy Lucas products—simple motor car spares such as contact sets and rotor arms. Mack where? They are not made in a Lucas factory in Birmingham or anywhere else in Britain but in France and Germany, in glossy packaging. It is printed in England but when one looks to see where the product is made it says "France" or "Germany". While all that has been happening, Lucas Industries has shed thousands of workers in Britain to export those jobs overseas.
Dunlop has done the same. Between 1977 and 1982 it dropped 50 per cent. of its British work force—24,000 jobs. It made sure that over roughly the same period the percentage of British employees in its work force worldwide dropped from 48 per cent. to 39 per cent.

Mr. Grieve: Has the hon. Gentleman paused to ask himself why that should be? Is it not because the goods could be produced more cheaply and efficiently elsewhere? Should we not be aiming at counteracting that and producing them more efficiently and with greater productivity here?

Mr. Rooker: Yes, of course I have asked myself why this has happened, as so many other people have. However, given the scale of the pull-out from Britain, it is clear that it has been the deliberate policy of many multinational companies to cut out their United Kingdom base and to minimise their dependency on the United Kingdom operation.
I do not know what part the Government's abolition of exchange controls played in this, but some companies have set up overseas financial centres so that they can export capital from Britain and deliberately invest abroad in a way which they could not do before. That has happened in countries where such companies are not


known for having good health, welfare and educational facilities. There are South American countries which have damned good armies and police forces but rotten social facilities for the workers. Of course the unit labour costs are low. Nor are they well known for having free trade unions to conduct the free collective bargaining which is so much appluaded by the Government. Nevertheless, there is clear evidence of a major pull-out from Britain by many leading companies.
My hon. Friends have made many proposals for direct action. I speak for the future in terms of what the west midlands and Birmingham chamber of commerce have said. There is no rosy future so far as they can tell. We want to know when the upturn will come. The latest quarterly survey by the west midlands and Birmingham chamber of commerce dated December 1982 shows that twice as many firms as a year ago think that their turnover will worsen. There has been a 50 per cent. increase in firms that have revised investment for plant and machinery downwards. Those firms are told by Ministers, "We are nearly there; it is the bottom," whatever that is: "You have got to invest for the future".
To talk, as did my hon. Friend the Member for Coventry, North-West (Mr. Robinson), about the great unemployment inequalities between the regions, the age groups, the sexes and the minority groups in our society is not scaremongering. The Government have deliberately set out to set neighbour against neighbour and worker against worker. In some parts of the country that is working, as people see no hope whatsoever.
Given the scale of what industry says it will do, which is not very much and given the lapdog attitude of the CBI leaders who promised a bare-knuckle fight with Government, all they seem to do is to export British jobs and queue up for knighthoods while they give their company money, which came off the backs of their customers, to the Tory party. There is no hope in that quarter.
When the last Labour Government asked industry, "What are your prospects? If you want Government assistance come and talk to us about your future plans for production and industrial location", they were told, "No, we are not going to talk to the Government."
Many of those companies cannot wait to shed their labour force. There is no hope whatsoever as long as this Government stay in office pursuing their present policies. It does not matter what they come up with now. The Government realise that in areas such as the west midlands they will lose dozens of parliamentary constituencies. It is too late for the Government to put the gloss on the damage that they have done in the last three years, which Labour Members of Parliament alone have sought to highlight.

Several hon. Members: rose—

Mr. Deputy Speaker (Mr. Bernard Weatherill): Order. As my predecessor warned the House, this is a three-hour debate. It must end at 9.58 pm. There is great pressure to speak, and I ask hon. Members to bear that in mind. If we have five-minute speeches, I shall be able to call most hon. Members who wish to take part.

Mr. Anthony Beaumont-Dark: I agree with the hon. Member for Birmingham, Perry Barr (Mr. Rooker) that a great deal has been said by hon. Members on both sides about the problems facing the west midlands. I disagreed with the hon. Member for Coventry, North-West (Mr. Robinson) when he said that it was factual, simple and direct and that it was all the Tory Government's fault. It was almost as though it was a deliberate policy. I do not think that that kind of comment helps to bring about an understanding of what really happened to the west midlands. It is not simple. What he said was not factual, and it certainly was not directly related to the issue.
In the 1930s unemployment was at a very low level—2 or 3 per cent. People came from Wales, the north-east and Scotland to jobs in the west midlands because we had possibly the only growth industry at that time, which was cars. The midlands—Coventry and Birmingham—were churning them out, as well as Fords and General Motors in the United States of America or Mercedes in Germany.
The problem we have this time is that because during the war the west midlands showed great productive abilities, with lorries, tanks and aircraft, once again people poured into the area. As soon as the war was over there was a great shortage of cars. Cars could not be bought for love nor money. Cars could be sold for double their list price. I remember more than once people being offered cars at double the list price in the papers and in the pubs.
People thought that this great cornucopia of the car industry would go on for ever, and it seemed that it would do so. Indeed, in Whitehall's mind it is still going on. It is felt that this problem is a temporary aberration and that the midlands will soon recover, but we know that it will not, because the car industry has changed enormously.
We must learn from what went wrong. The introduction of IDCs and the shifting of production lines 200 miles to Bathgate or Halewood did not transfer prosperity to those areas. We all know that now, because those plants are dead. Instead, such changes virtually killed an efficient motor industry.
We can now say that companies such as Jaguar and Rover have had a year free of labour disputes, but not so long ago the motor industry was fighting for its life and labour relations were the subject of music hall and television jokes. That may be a thing of the past, but it had its damaging effect.
As the CBI has pointed out, in the last 10 years the RPI has gone up by 278 per cent., energy costs have increased by more than 400 per cent., rates have risen by 416 per cent., and the national insurance surcharge and national insurance payments have gone up by 621 per cent. Consequently, there is a great tax on jobs. That is what the national insurance surcharge is. It is a tax on exporters, not on importers.
The Budget will be of tremendous and profound importance. We do not need the approach of the Institute of Directors. We should not give tax concessions to people who are already in jobs. Directors may want, but do not need, tax concessions. Nor do we need more tax concessions on capital, good as that might be in its own way. We should not talk about reducing the standard rate of tax. Instead, the Government should increase personal allowances, people on the lowest rate of tax should be


taken out of tax, and any tax concessions should be given on the threshold. That is no more than common sense and common justice.
When the CBI said that the competitiveness of British industry was 20 per cent. below that of Europe, it was not talking about the value of the pound falling another 20 per cent., as Terence Beckett made clear. It has asked for Government help to back up what industry has already done to reduce its costs. There are several things that the Government can and should do to get industry moving, not just in Birmingham, Dudley or Bromsgrove. If industry improves, the heart will beat faster and will recover quicker.
Energy costs are still uncompetitive for large manufacturers. Something should be done about that. It would only cost about £200 million, but it would be a fillip to industries such as chemicals, paper, board and foundries.
The national insurance surcharge should never have been introduced. It must now be wiped away. It is a tax on jobs and it cannot be justified. What about industrial derating for manufacturers? Why cannot industry be treated like our prosperous farmers? I know that the farmers have a much better lobby, perhaps because many hon. Members are large landowners and therefore understand the problems of land more than the problems of industry. But if farmers can have rates relief, what about our hard-pressed industries? Why not save British Leyland £630,000 in rates? Why not save Guest Keen and Nettlefold £1·2 million in rates? Why not save Birmid's £400,000 in rates? That would help to create jobs. What is good for the farmers is good for industry.
We do not need assisted area status or enterprise zones. We do not need an arrangement whereby a factory at this end of the Chamber gets all the help in the world but if you, Mr. Deputy Speaker, have a factory at your end of the Chamber you have had it, or rather you are not going to have it, because you are on the wrong side of the line. Enterprise zones are all right in great open fields. They are all right in the Welsh hills and valleys where there may be no factories already. Elsewhere, however, they cause great and artificial divisions. Let us have no more of them.
Some people are calling yet again for more help here and more help there, but that is the approach that has sapped the strength of the west midlands. The assisted areas and good-hearted schemes that drive industry here, there and everywhere have caused the poverty. The IDCs and all the similar schemes were based on false assumptions.
Hon. Members on both sides of the House are united in their attitude to Spain and Spanish cars. That great injustice must not be allowed to continue. If Spain will not reduce her duties, we must raise ours. Our oriental friends, the Japanese, must be told once again that talkee-talk is all right but that jobs must be preserved. If the Japanese wish talks to continue, let us give them three months to come to an agreement, or deal with them in the same way.
The cities and county councils must remember that the money they spend comes from the backs of industries which may decide, every time their rates are increased by £1, that someone else must go. If the Government and councils use common sense, without any great ideas about assisted area schemes, we shall survive. The Government have their part to play. What they do for industry on 15 March will decide whether the west midlands prospers or flounders.

Mr. Terry Davis: We have heard four speeches from Conservative Members and all four have sought to excuse the Government's record. The hon. Member for Bromsgrove and Redditch (Mr. Miller) began it by saying that a decline in the west midlands was forecast 20 years ago. He is right about that, but he is wrong to imply that a decline of such magnitude was ever forecast before the present Government came into office. The hon. Gentleman also said that the adverse industrial structure of the region was partly to blame for its problems. He is right in that, too, but he did not say it in 1979.
In March 1979, on the eve of the general election, the hon. Gentleman published "A Manifesto for the Midlands" with his right hon. Friend the Member for Worcester (Mr. Walker) and his hon. Friend the Member for Loughborough (Mr. Dorrell). In that manifesto he wrote:
It is not a region packed with dying industries. It is a region well equipped to meet the challenges of a modem world.
Today, however, the hon. Gentleman talks of an adverse industrial structure.

Mr. Hal Miller: I think that the hon. Member will agree that the region is well equipped with communications, skilled people and opportunity.

Mr. Davis: I stand speechless before the hon. Gentleman's excuses for the Government and his apologies for his own words in 1979. He did not tell the people of Bromsgrove and Redditch, of whom I am one, that the adverse industrial structure of the west midlands would lead to a trebling of unemployment during the life of this Government.
The charge against the Government is not that they caused all the problems of the west midlands but that they have done nothing to solve them, and have actually made them worse.
The hon. Member for Birmingham, Yardley (Mr. Bevan) referred to the much lower unemployment figures at the time of the general election in May 1979. He was quite right. Unemployment in the west midlands has trebled since his Government came to power. It has risen from 5 per cent. then to almost 17 per cent. now. The figure is even higher in the west midlands county than in the west midlands region. Given that at least 30 per cent. of the unemployed are not registered, unemployment in the county is now nearer 25 per cent., or one in four, compared with one in 12 in May 1979. For every vacancy, there are now 57 people unemployed in the west midlands county compared with 29 in Great Britain as a whole. The west midlands figure is double the national average. Indeed, a factory recently attracted 500 applicants for 15 vacancies without even advertising outside.
The hon. Member for Rugby (Mr. Pawsey) referred to the region's position in the unemployment league table, but the position of the west midlands is even worse than he suggested. The Office of Population Censuses and Surveys recently published a survey of the nine regions in England. In 1979, the west midlands was fourth out of the nine with 4·7 per cent. unemployment, which was also the average for England as a whole. After two years of Conservative Government, the west midlands was first in the league, 12·7 per cent. unemployment, compared with 9 per cent. nationally.
From being the average, the west midlands has become the leader, despite constant promises from the Government of good times just around the corner.
In June 1979, the then Minister, the hon. Member for Basingstoke (Mr. Mitchell) told the House that the results of the Government's policies would be seen by the end of the year, with more to come. He could not have been more right, and there was certainly more to come—more and more unemployment.
This is the fourth debate about the economic problems, the unemployment and the industrial decline of the west midlands since the Government came to power. In June 1980, the then Minister, the hon. Member for Bosworth (Mr. Butler) said that there were grounds for optimism. In March 1981, the then Minister, the hon. Member for Arundel (Mr. Marshall) said that we should take comfort from the fact that four regions were even worse off and that the west midlands had less unemployment than the north, the north-west, Wales and Scotland. Since then, we have overtaken the north-west and Scotland, and only Wales and the north are still worse off. In December 1981, a new Minister, the hon. Member for Norfolk, South (Mr. MacGregor) said that he recognised that industry in the west midlands faced its most difficult period since the war. He said that it was an uphill climb—too right, and every time we push it up the hill the Government push it down again.
Today there is a new face at the Dispatch Box. It looks as though the Under-Secretary of State for Employment, the hon. Member for Eye (Mr. Gummer), will be replying to the debate. Why does a different Minister reply to each of these debates? It is because Ministers are scared that we shall remind them of what they said last time.
In December, the Birmingham chamber of industry and commerce produced a survey of 84 firms. Conservative Members may not like the results, but they cannot run away from what their own friends in industry are saying. The survey showed that, compared with December 1981, fewer firms were reporting increases in United Kingdom orders and more were reporting decreases. Fewer reported increases in export orders and more reported decreases. More firms were working at less than 60 per cent. capacity. More had lower stocks and forecast even lower stocks. More firms reported cash flow problems. More firms reported that their work forces would decrease during the next three months. More firms reported that they would revise their investment plans downwards. Fewer firms were confident that their turnover would improve under this Government. That survey was in December.
What has happened since then in the west midlands? There have been 500 redundancies at Dunlop, 500 redundancies at Lucas Girling with the closure of a factory at Tyseley, 800 redundancies at Lucas Electrical and almost 400 redundancies at Imperial Metal Industries. None of those redundancies is the result of strikes, low productivity or any other of the reasons given by Conservative Members. In January alone the west midlands had 2,500 redundancies. They are running at the rate of 100 per working day. During the past six months the west midlands has lost 14,000 jobs.
Employers declaring the redundancies do not blame strikes, low productivity, trade unions or wage claims. Quite simply, they blame lack of work, drop in business,

a slump in orders and a slump in demand. In one word, there is a slump. That is the cause of the job losses, not the adverse industrial structure that we have had for the past 10 or 20 years.
Against that background, we need special measures. The west midlands needs to be put on an equal footing with the other regions whose unemployment levels we have overtaken. Several hon. Members have said that the west midlands is part of the United Kingdom. As the hon. Member for Birmingham, Selly Oak (Mr. Beaumont-Dark) said, we should seek to reduce the costs of industry, but there are two ways to do that. The better way is to increase demand and production. That would reduce industrial costs. To achieve that we need reflation and more Government spending instead of less. The Government should not cut back, but should create the demand and create the markets for the goods made by British manufacturing industry.
To get the benefit of that demand, we need import controls, but we will not obtain them from the Government. They will not impose import controls on Japanese cars. Most Conservative Members are opposed to import controls on Japanese cars. Every survey carried out proves that. My hon. Friend the Member for Birmingham, Perry Barr (Mr. Rooker) expressed surprise that goods are imported by multinational companies such as Lucas and Dunlop. He should remember that the same multinationals wanted to take us into the Common Market so that they could switch production to the continent.
We have seen a succession of new ministerial faces at the Dispatch Box replying to debates about the west midlands. But we need new policies. The Government have had plenty of time to change their policies, but they have declined to do so. It is time for the people of the west midlands to change the Government.

Mr. John G. Blackburn: I am grateful for the opportunity to speak, even if only for a few minutes, in this important debate about the west midlands. There has been wide agreement about the problems of unemployment in that region. I wish to concentrate on only three or four aspects of that. First, it is true and acknowledged on all sides that unemployment in the west midlands did not start in May 1979. In my constituency, there were 4,200 job losses between 1977 and May 1979.
As always in these debates, I am pleased to see the hon. Member for Wolverhampton, South-East (Mr. Edwards) in his place. I would expect him to be here because his area suffered large and savage redundancies with the closure of the Bilston steelworks. Many of its workers live in the northern part of my constituency.
I have spent 22 years of my life walking the avenues of industry in the west midlands, like so many people in the Chamber and outside. During that time I, like everyone else, took a 316 per cent. pay rise and, in contrast, produced only 17 per cent. more goods. I learnt the hard way in the black country that everything starts with an order. An order means production, production means jobs, jobs mean profits and profits mean reinvestment. Everything starts with an order. We must learn the lesson—if we have not learnt it before—that our industry is utterly dependent on orders, on being competitive, and on producing the right models and the right goods for the right markets. I have stood here, with hon. Members from both sides of the House, in debate after debate, urging the


Government to invest in the LC10 model, which we believe will have a tremendous impact on the economy of the west midlands. Nevertheless, I am saddened when I discover that many of the components for that model, which is being produced in the west midlands with Government aid, are not to come from the area. We do not produce motor cars in Dudley but we produce components. The car industry is the lifeblood of the engineering industry in the west midlands.
I may not be popular for saying it, but it is part of my psychology that Governments were never elected to run industry. They are not capable of running industry. They are not qualified to run industry but they have a solemn responsibility to create an environment in which industry can prosper. In that connection, I echo what has been said about the 10 per cent. reduction in tax on the motor industry. Nevertheless, it is not the answer. We must ensure that that makes the product competitive and that people buy British goods.
Another important issue is whether the west midlands can compete. I sincerely believe that the people of the west midlands are capable of competing, but on one condition—that the terms are equal. We are not competing on equal terms. I am not one of those who advocate assisted area status.
In the next 24 hours I and several hon. Members, including my hon. Friend the Member for Bromsgrove and Redditch (Mr. Miller) will be keeping an appointment to see my right hon. Friend the Secretary of State for Industry. I shall plead the cause of the Round Oak steelworks with him. I remember vividly the excellent speech by the hon. Member for West Bromwich, West (Miss Boothroyd) who dealt with the problems at the London works and the Duport foundry.
Capital for investment in the west midlands is available. People are interested in investing in our excellent work force. However, there must be a political will to allow that to happen. That all revolves around the Government's responsibility to create an environment in which business can prosper. In that spirit, I have abundant faith in the west midlands, provided that it can compete on equal terms. In that spirit also, I still believe that there is a future for the fine people of the west midlands and what they produce. It is for the House to give the fine workers there its united vote of confidence.

Mr. Robert Edwards: It is always a great pleasure to follow the hon. Member for Dudley, West (Mr. Blackburn). I noticed that a firm in his constituency, Cannon Iron, wanted 15 temporary labourers a few weeks ago. There were 500 applicants. They walked from all over Wolverhampton to get a job there. That gives some idea of the scale of the problem in Wolverhampton and the west midlands.
The facts have been recited throughout the debate, but they are well worth repeating. In 1978, 6 per cent. of the work force in Wolverhampton were unemployed and their number was being reduced. In Bilston in my constituency it is 26 per cent. In one ward in Wolverhampton it is over 30 per cent. The people are in despair. They feel like criminals and outcasts. There is nowhere in this great big world where they can fit in. They are depressed. Some 300,000 in the west midlands receive supplementary benefit. They have to go through the undignified process of applying for it. That has never happened before.
In Wolverhampton, 7,000 children are relying on free meals and extra support for clothing and boots. That has never happened before. The people are in the poverty trap and are suffering all the indignities that that involves. The hon. Member for Bromsgrove and Redditch (Mr. Miller), for whom I have great respect, suggested that no real initiative is necessary and that the market should solve the problem. I am sure that he did not make that suggestion seriously.
The hon. Member for Dudley, West (Mr. Blackburn) suggested that we should have fair competition. With fair competition, the west midlands people, with all their skill and traditional wisdom, will come through. However, what sort of fair competition exists today? The industries are competing against the cheapest labour in the world in South Korea, Malaysia, and now in Communist China.
According to the import figures, 78 per cent. of sporting equipment here is imported. Once, in my time, we dominated the production of sporting equipment. The biggest producers were Dunlop. Its factory in Malaysia now supplies most of our imports. Dunlop, a multinational company, has factories all over the world. It is cutting its British labour force to the bone. It has closed its tyre factory at Speke, and jobs have disappeared as if they never existed. It has cut back its labour force at Port Dunlop in Birmingham. A few thousand jobs will disappear.
Dunlop is now negotiating an agreement with China to build a large tyre factory in China. The firm will be supplied not with Chinese currency, which is unconvertible, but with tyres. The European and British market will be flooded with tyres produced by some of the cheapest labour in the world. It is not so long since Dunlop was saying that it could not produce tyres in British factories because of the cheap tyres that were coming from east European countries. Some of the factories in those countries were built on 50–50 agreements with British and American multinational companies. Those agreements still exist.
The import figures reveal a dreadful state of affairs. For example, 95 per cent. of the cutlery used and sold in this country comes from abroad. South Korea can produce 1 billion knives every year with which to flood world markets. The price of the cutlery is less than the price of steel. How does one deal with such dumping? It roust be stopped by import controls.
Some of the other figures astonish me. Hand calculators could be produced by British Aerospace without difficulty, yet 72 per cent. come from overseas. We can make hand calculators, but our problem is that we cannot compete with the cheap slave labour of Thailand and South Korea.
It is the nth degree of human stupidity to allow our industries to be destroyed and to decline and to cause desperation and anxiety among our people. To maintain our industries we must take steps to stop the dumping of the products made by cheap labour.

Mr. Nick Budgen: The hon. Member for Wolverhampton, South-East (Mr. Edwards), who comes from the same midlands town as myself, demonstrates the desperate thoughts so strongly felt in Wolverhampton at present. When I first went there, almost nine years ago to the night, I found that Wolverhampton had enjoyed about 40 years of


uninterrupted prosperity. It had known little unemployment and had the self-confidence that came from believing that it would enjoy a constant boom.
During the past nine years Wolverhampton has been hit and hit again. There are many who, in desperation, look to desperate remedies to solve their problems. The three main shocks that hit Wolverhampton were the increase in energy prices in 1974, the increase in energy prices in 1979 and the crucifyingly high sterling exchange rate which came about at the end of 1979. It is significant that, just as Wulfrunians do not thank Governments for the prosperity that they enjoyed for 40 years, they do not now generally blame the Government for the disasters that they now suffer, sometimes with desperation but always with dignity.
I agree with my hon. Friends the Members for Rugby (Mr. Pawsey) and for Birmingham, Selly Oak (Mr. Beaumont-Dark) in being sceptical of Government solutions. I believe that Governments have an overriding duty to attempt to improve the position, particularly through the tax system.
I agree with hon. Members from all sides of the House who attack, as firmly as possible, the scandalous imposition of the national insurance surcharge. It is a tax on jobs. There may have been some justification for it when it was imposed at a time of higher employment, but there is no justification for it now. Let it be abolished as quickly as possible. I agree with those of my right hon. and hon. Friends who are distraught, even disgusted, about the delay in the way in which the Government have sought to renegotiate our trade agreement with Spain.
We know that it must be carried out through the EC, but if the Government wish to see the west midlands supporting the ideal of Europe, they had better get on with renegotiating that deal with Spain. It is becoming increasingly clear to many of those who supported entry into the Community that, had we been able to negotiate directly with Spain, the treaty would have been renegotiated long ago. Let us hear rather less talk about how it is being done through the Commission and how we have made several initiatives to the Council of Ministers. This matter is urgent and has wider repercussions than many of those in government understand.
However, the Government could make things much worse in the west midlands. It is obvious that the Government are as yet undecided about their policy on the price of North sea oil. On the one hand, the Treasury is delighted that the price should remain high so that the tax take remains high. On the other hand, the Department of Industry understands that low energy costs are good, especially for heavy manufacturing industry. The Department of Energy wishes to have high North sea oil prices because that will encourage further investment in North sea exploration.
However, we in the west midlands are in favour of low energy prices. We wish to see OPEC crack. We do not mind if some of the punters who have had a punt on North sea oil lose a bit of money, because we believe that social stability is one of the most important factors for which the Tory party stands. The laying waste of our heavy manufacturing industry is not good for social cohesion. Let us join those who wish to see OPEC smashed.
There are advantages in a 12 per cent. devaluation. We do not wish to have a managed devaluation of 30 per cent.,

but there are advantages in a devaluation that has been caused by the market and which will operate as an import control. We must not have higher interest rates in order to increase the exchange rate again.

Several Hon. Members: rose—

Mr. Speaker: Order. The Minister has agreed that he will not reply until 9.43 pm.

Mr. David Winnick: Everyone knows that the west midlands had many difficulties before 1979. The industrial base was too narrow and new technology industries were required. However, the indictment against the Government is that their economic policies have led to the west midlands, and certainly the black country, suffering devastating blows during the past three years. In May 1979 unemployment in my travel-to-work area Walsall, was 5·1 per cent. Today, even on the new basis on which the figures are calculated, it is 18·8 per cent. Conservative Members have said throughout the debate that there was unemployment in the west midlands before the present Government came to power. They are right, but there was no mass unemployment, nor was there the poverty and devastation that goes with it.
There is little doubt that the true unemployment figure is even higher than 18·8 per cent. It is likely to be nearer 25 per cent., and the same is true of other parts of the black country. An important way in which we can judge the severity and the depth of unemployment is to note for how long people have been unemployed. In a reply that I received last week I was informed that between January 1979 and October 1982 there was an increase of 423 per cent. in those unemployed for more than 12 months in the Walsall travel-to-work area. In Dudley and Sandwell the figure is 562 per cent. and for Wolverhampton it is 374 per cent. For the region as a whole, the increase for those who have been unemployed for longer than 12 months is 379 per cent.
What about young people, who obviously leave school desperately eager to find a job? Between January 1979 and October 1982 there was an increase in the west midlands of 621 per cent. for those under 20 who had been unemployed for more than 12 months.
I have given the statistics, but behind them lies the tragedy of people who cannot find a job. Certainly there are the young people, but let us not forget those in their 40s and early 50s who are not only unemployed but face the daunting prospect that unless there is a change of policy and a change of Government they may never work again. Their crime is to be 45, 48 or 52. They have worked all their lives and now find themselves not only unemployed but daily having to face the terrifying possibility that, no matter how hard they try, or how desperately they seek work, there is no opportunity for them. I hope that the Minister will deal with the plight of those people, who stand little or no chance of being able to earn their living.
My hon. Friend the Member for Wolverhampton, South-East (Mr. Edwards) already referred to a case involving one vacancy. Another case was quoted in the Express and Star last week. There was vacancies for 30 people in a hotel, but 500 people turned up seeking those jobs. That is an illustration of what has happened in the west midlands and the desperate situation in which we find ourselves.
We last debated the difficulties of the region in December 1981. I was lucky in the ballot and initiated that debate. I spoke then of the plight of the unemployed and the tragedy of what is happening in the region. What is terrible, as my hon. Friends have stated tonight, is that things are now so much worse. Unemployment has continued to grow and there is no sign of economic recovery at all. I hope that we shall not hear phoney optimism from the Minister tonight. We know that there is no sign of any economic recovery. However high unemployment is now, in the next few weeks or the next few months unemployment will grow worse in the west midlands and the black country.
We need changes of policy. We need more demand in the economy. Lack of demand, above all else, has been the cause of what has occurred in the past few years. We need a more competitive exchange rate. As my hon. Friends have said, we also desperately need selective import controls. Surely the time for debating that matter is over? If British manufacturing industry is to survive, we must have some protection. That point has been stressed tonight by some Conservative Members as well as by my hon. Friends. We need the restoration of exchange controls. The abolition of exchange controls has been almost a direct incentive for the export of capital.
What we really need above all else, and what would give hope for the west midlands, is a change of Government. We need a Labour Government pursuing economic policies that would reverse the tide of mass unemployment. The people of the west midlands are sick and tired of being the victims of the Government's policies. They do not want to be punished and penalised. They take the view—and we agree with them 100 per cent.—that they have a right to earn their living. They do not want to live the rest of their lives on the dole queue, living on the very minimum. Is it too much to ask that in the Britain of the 1980s our fellow citizens should have the right to work? There is no hope with this Government. The defeat of the Government at the next election and a change of policy is the best hope for the west midlands to be able to survive as a major manufacturing industrial area.

The Under-Secretary of State for Employment (Mr. Selwyn Gummer): I was hoping, before the speech of the hon. Member for Walsall, North (Mr. Winnick), to follow the advice of the hon. Member for Cannock (Mr. Roberts) and address myself to the issues rather than to bandy party political accusations across the Floor of the House on my first visit to the Dispatch Box. I thank my hon. Friend the Member for Bromsgrove and Redditch (Mr. Miller) for his kind words. I congratulate the hon. Member for Coventry, North-West (Mr. Robinson), who introduced the debate from the Opposition Front Bench, on his success and that of his fellows in procuring the debate.
It would be wrong to start in any other way than by saying that any of us who pretend that unemployment is a matter which can be dismissed or grinned about do not understand the debilitating nature of being without a job. Many hon. Members, from background or recent experience, are aware of that effect on their own lives and on the lives of their constituents.
It is important to say that in the west midlands there has been quite a sudden change. It was an area of relatively low unemployment and it is now suffering considerably higher unemployment. The change has come so much

more suddenly than in areas which have been struck by high rates of unemployment over a long period. The west midlands is suffering the particular pains, difficulties and disillusion that come with that change. It would be wrong for anyone to ignore or deny those facts.
It is vital—

Mr. Ivan Lawrence: rose—

Mr. Gummer: I have very little time to cover the issues which have been raised already. There are hon. Members on both sides of the Chamber, including my hon. and learned Friend the Member for Burton (Mr. Lawrence), who were unable to catch the eye of the Chair and make their contributions because of the time limit.
We should treat seriously the speech of the hon. Member for Coventry, North-West, and perhaps more seriously than some others. The hon. Gentleman made a real attempt to provide alternative answers to the problems which face us. It does the unemployed no good merely to rant and rave about those whom we dislike and the policies that we do not accept. The only answer is to suggest policies that might solve the problems to which we address ourselves.

Mr. Lawrence: rose—

Mr. Gummer: I shall not give way at this stage. I gave as much time as I could to as many hon. Members as possible.
The hon. Member for Coventry, North-West offered four answers to our problems.

Mr. Geoffrey Robinson: Five.

Mr. Gummer: If there was a fifth one, I shall return to it when I have found it in my notes. The hon. Gentleman offered four answers which I suggest were of great importance. The fifth one may have been the general one that was adopted by the hon. Member for Walsall, North, who wants a new Government. The hon. Gentleman's four specific answers do not meet the real issues. First, he suggested that the west midlands should have assisted area status. That argument has been advanced on both sides of the House. Similarly, it has faced opposition on both sides. It cannot be said that it is a suggestion that is accepted as a panacea by everyone in the west midlands.
A review of the policy of area status is taking place and the second stage is about to begin. One of the most important matters to be considered will be the position of the west midlands and the arguments that have been advanced for the west midlands having assisted area status. It would be only reasonable to tell those who are carrying out the review that the argument did not seem to be conclusive as it was adduced on either side of the House. It does not seem to be recognised as such in the west midlands.
Secondly, the hon. Member for Coventry, North-West said that we should have an answer to the question surrounding the Nissan project. My right hon. Friend the Secretary of State for Industry has talked to Nissan's top management. He did so during his recent visit to Japan. It is clear that Nissan is not yet in a position to take a decision on the United Kingdom project. It is equally clear that a favourable outcome is still a real possibility. The contact with the company will continue and I hope that we shall be able to make an announcement. Unfortunately, we cannot make one now.
It would help a great deal if the Labour party dropped its decision and determination to leave the European Community. If there is one factor that is likely to make Nissan think again, it is the feeling that, at the drop of the hat, and with no referendum, Britain might cease to have the major part of its present export market. One has to ask the Labour party to take the responsibilities that are reasonable to an Opposition.
The hon. Member for Coventry, North-West and other hon. Members suggested that we should use selective import controls. For an area that has depended for so long on its exports to go for selective imports seems to me to be little short of madness. It is certainly reasonable to protest strongly about unfair imports, and I agree with many of the points made about Spanish cars. The word that has been used, and I use it again, is that the arrangements that we have are "grotesque". I repeat the assurance that the negotiations are continuing.
My hon. Friend the Member for Wolverhampton, South-West (Mr. Budgen) made the point that negotiations always take time in the European Community. His scepticism on the Community is well known. However, I assure him that later in the month the Commission is due to report the results of those negotiations and the Secretary of State for Trade will be visiting the west midlands at the end of the month to discuss the matter with the industry.

Mr. Les Huckfield: Big deal.

Mr. Gummer: We shall see whether it is a big deal. The hon. Member for Nuneaton (Mr. Huckfield) may be leaving the west midlands as he feels that he cannot be reelected there, and is in no position to say "Big deal".

Mr. Budgen: Will my hon. Friend please give some prediction to the House as to when these "grotesque" arrangements will be changed?

Mr. Gummer: The anouncement of the results of those negotiations will be made to the Council later this month. The Secretary of State for Trade will then discuss the matter with representatives of industry in the west midlands. I can give my hon. Friend that clear and categoric assurance, but I cannot give him the results of the negotiations, or there would be no point in having them.
The proposals made by the hon. Member for Coventry, North-Esat were supported by a number of hon. Member, including some of my hon. Friends. Where I am unable to answer hon. Members' points in the short time that I have, I shall write to the hon. Members concerned. My hon. Friend the Member for Bromsgrove and Redditch (Mr. Miller) made an important point when he asked Labour Members how it was the they continued to talk without mentioning one of the most important effects on industry in the west midlands—the high rates levied upon it.
If Socialist-controlled councils would put to the forefront restraint in their spending, and make their contribution to the improvement of industry in the west midlands, it would be a good example to central Government. It is a sad thing that in seeking to attack the Government, Labour Members did not take the opportunity to bring home to their supporters the fact that they have within their own hands a means of helping industry in the area about which they are concerned.
The main burden of the argument of the Labour party has been that the way to deal with the problems of the west midlands is to pump more money into the economy as a whole. The hon. Member for Coventry, North-West said that he felt that what the Government had done up to now was a hotchpotch of relief schemes that the Secretary of State had grudgingly agreed.
If the hon. Member feels that the large numbers of important schemes that have been taken up widely in the west midlands are merely that, he is flying in the face of everything that other people of all political parties would say about the west midlands. He may ask for further relief and further schemes, but to suggest that the considerable package of schemes that has been seen to be very successful in many parts of the west midlands is merely a hotchpotch grudgingly agreed is flying in the face of the facts.

Mr. Geoffrey Robinson: rose—

Mr. Gummer: I have only five minutes more and I cannot give way. The hon. Member made the longest speech so far this evening and it is reasonable for me to want to finish in the quarter of an hour that I have been allowed.
Behind all this, the major demand of the Labour party is for a large input of cash into the economy. That came out most clearly in the speech of the hon. Member for Birmingham, Perry Barr (Mr. Rooker). He said that he did not want to go in for bipartisan twaddle. He certainly did not go in for bipartisanship, but we heard a great deal of twaddle. He suggested that the problems of the west midlands had been caused by this Government since 1979. He then proved that that was quite untrue.
In so far as he went in for facts, the hon. Gentleman's major case concerned Lucas and the fact that for several years Halfords had sold goods that were manufactured abroad. He then said that those goods had been manufactured in countries that had strong armies and police forces but not much else. The hon. Gentleman then cited the countries, and they were France and Germany—[Interruption.] I have a note in front of me. The hon. Member for Perry Barr can look at the record, but he said that Lucas was manufacturing in France and Germany. In those countries wage rates are higher than in Britain. The provision for workers is better than in Britain. Why is Lucas manufacturing in those countries? The answer is that productivity in those countries has for years far outstripped that in Britain. Therefore, the case is proved.
Over the years the west midlands, largely through the ineptitude of the trade union leadership, but also through the appalling record of industrial relations that has marred its industries, has sadly not kept up in competition with other countries. I refer not to some sad little country in South America but to France and Germany, which can compete with us right across the board.
I considerably respect the hon. Member for Wolverhampton, South-East (Mr. Edwards), but I was sorry to hear him make that speech. He spoke about imports from Malaysia, but hon. Members should realise that some of the imports from developing countries are essential to the lives of those nations. To hear the Labour party becoming little Englanders not only towards the European Community but towards the poorest nations on earth is little short of disgraceful.
We face high unemployment in the west midlands, which is part of the worldwide legacy of the recession.


However, it is worse in Britain and in the west midlands not because of this Government but because of years of neglect, a refusal to face the reactionary labour policies of the trade union movement and the way in which this industry has been destroyed by those who have put money before increases in productivity and have demanded more money for less work. By putting those basic facts right, this Government will achieve a rejuvenation of British industry throughout the country and, above all, in the west midlands.

Orders of the Day — Overseas Visitors (NHS Charges)

Mr. Alfred Dubs: The Government introduced their new proposals to charge overseas visitors for National Health Service treatment at the beginning of October 1982. Those proposals followed several debates and statements in the House and the report of a DHSS working party that looked into the possible working of the scheme, as well as a thorough investigation by the Home Affairs Committee. I also happen to be a member of the Sub-Committee on Race Relations and Immigration, which looked into the scheme in detail.
My main purpose is to raise some of the issues that have come up since the scheme's introduction. It is useful to remind ourselves of the Government's case for introducing the scheme. The Government put forward only two arguments in favour of it. First, they said that it would raise £6 million a year, and they assured us that that was a not inconsiderable sum. Of that, £1 million was to be obtained from fees to be charged for NHS treatment of overseas students in their first 12 months in this country. That came on top of the swingeing fees that overseas students at our universities are charged as a result of the Government's actions.
The second justification put forward by the Government for introducing charges for NHS treatment was that there was abuse of the NHS and that the scheme would somehow lessen or prevent that abuse. Let me remind the House of the opposing arguments, to which I subscribed. The first was that the Government would not in fact raise £6 million by means of these proposals. The second was that there was little evidence of abuse, and that what abuse there was was on a small scale. Thirdly, the whole idea was most unfair to overseas students. Fourthly, the proposals would be seen to be discriminatory against the black population of this country who, although eligible for NHS treatment, might be subjected to a more difficult process of questioning when they went to hospital for NHS treatment. This view of the discriminatory possibilities of the proposals was fully supported by many health authorities which gave evidence to the Home Affairs Select Committee. The fifth argument against the proposals was that they were extremely complicated, would impose an extra burden on NHS staff who had better things to do, and might be applied incorrectly or improperly because of the sheer complexity of the way in which the system should be applied.
In its report, the Select Committee, not surprisingly, divided on party lines. I shall refer in particular to the evidence that the Secretary of State gave to the Select Committee on 1 March 1982. First, he said:
I must emphasise that there is nothing in the proposals that I am to do which needs or, I believe, will, increase racial discrimination or tension, as far as that is concerned. Certainly I would do everything in my power to prevent that taking place.
That is a fairly clear commitment. Secondly, the Secretary of State said, on the same day:
On first hearing that proposition, my aim is to demonstrate to everyone concerned, and to the ethnic minority groups, I suppose, in particular, that this system is fair. Yes, I would be prepared to consider some kind of checking system, if that were thought to be useful.
The Select Committee thought that that form of monitoring would be useful, and recommended accordingly.
What has happened since 1 October, when the scheme was introduced? Many of us were interested to know how


it was working. So I asked a number of parliamentary questions last December, thinking that I would get some evidence about what was happening. I asked how many overseas visitors had been charged, and what the income had been for each regional health authority. I asked about extra staff having to be appointed to administer the new procedures. I asked whether the new procedures had been introduced in all hospitals. I also asked from which countries the overseas visitors came who had been charged for this treatment. The Minister of Health replied on 9 December 1982:
The information sought in these questions is not available centrally".—[Official Report, 9 December 1982; Vol. 33, c. 587.]
I asked a further question about a week later as to whether the Secretary of State would introduce a monitoring system, to which the Minister of Health replied:
I see no need to do this at present and doubt whether the expense to public funds would be justified".—[Official Report, 16 December 1982; Vol. 34, c. 247.]
Finally, today I asked whether the Secretary of State for Social Services was satisfied with these new procedures and whether they were working satisfactorily. The answer came:
Yes, so far as I am aware".
Those answers are a little surprising, to say the least, in the light of the undertaking given by the Secretary of State when he met the Home Affairs Select Committee. He said that he would take care to ensure that racial discrimination did not take place in administering the scheme and that he would consider a checking system, if that was thought to be desirable. Clearly, it was thought to be desirable. In my opinion, the Secretary of State gave perhaps not explicit but certainly implicit undertakings that he would monitor the progress of this controversial scheme.
I would further argue that the Secretary of State has, in the event, not kept the undertakings that he gave to hon. Members. Accordingly, I wrote to all 14 regional health authorities in England putting to them the questions that the Secretary of State was unable to answer because he was not collecting the information. Some of those answers have arrived. Some are still coming in. They cover the three to four-month period since the new charging method was introduced on 1 October. I have done some rough calculations on the basis of the information that I have so far received. I wish, from that point of view, that the debate was taking place in a few weeks' time when I shall have the full results.
The population covered by the regional health authorities that have so far supplied information amounts to about 14·5 million out of a total population in England and Wales of 50 million. I appreciate that one cannot be precise. A heavier weighting in terms of charging overseas visitors arises in the London area. Of the four regional health authorities covering London and the home counties, one has so far replied. The total income obtained by the regional health authorities that have replied, in the three to four-month period, although they did not all give figures for the same period, was £22,000. Even if that figure is multiplied by four on the assumption that their replies related to a three-month period, this gives a figure of £88,000. Projected on the basis of the population for England and Wales, the figure becomes £300,000.
I accept that these figures are not the best basis for making estimates. Even so, the Minister should be concerned that the original estimate of £6 million by his Department is not likely to be met in the first year. There are, of course, teething troubles. It is known that not all hospitals and not all district health authorities are yet operating the scheme. That may be an argument for saying that more money can be expected, although it is not an argument, I believe, from which the Minister will take a great deal of comfort.
In support of the argument that the money will not amount to the sum originally suggested, I should like to refer especially to overseas students. A number of parliamentary questions were asked by my hon. Friend the Member for Crewe (Mrs. Dunwoody) last year about the expected income from overseas students. In March 1982, it was expected that £500,000 would result from Health Service charges imposed upon overseas students who had come to this country at the invitation of the British Government. Given the original estimate by the Department of Health and Social Security that students would contribute £1 million, it can be seen that roughly 50 per cent. comes from those students invited by the British Government.
By December 1982, the Minister for Overseas Development had clearly revised his figures. His reply stated that the likely contribution of the overseas students who came at the invitation of the British Government would be £100,000. On the basis of simple proportions, it is likely that the income to the DHSS from all overseas students will be £200,000. It might be a little more because the Minister added that the overseas students coming under the British Government scheme had had previous health checks, were therefore a bit healthier than the average, and would need less Health Service treatment.
There have been other developments since the scheme was introduced. A judgment by the House of Lords in December is usually referred to as relating to Shah and others. This was concerned at least in part with the definition of the words "normally resident" in this country. That is important, because the definition of who is normally resident arises on this method of charging overseas students. One interpretation of the House of Lords judgment is that "normally resident" has now been defined in such a way as to cover all overses students who would no longer be liable to pay for NHS treatment. I cannot say with utter precision whether the House of Lords judgment will mean that in practice, but it is certainly how it has been interpreted by students and organisations representing them.
There are three particular respects with which we must all be concerned as to how the scheme is now working. First, some people are being charged large sums of money for NHS treatment as a result of accidents that have occurred during a visit to Britain. There was a case in Bradford of an individual, I believe from the Indian sub-continent, who was visiting Britain on holiday. I think that he broke his leg and was charged £7,500 for treatment. It may be that such examples of heavy charges are exceptional— I hope that they are—but it must be a matter for anxiety if people suffer from acidents while visiting Britain and have to pay large sums of money for something which could not be anticipated.
Secondly, it is my contention that some people are being charged incorrectly or out of line with the Government's stated intentions when the scheme was


introduced. May I give one example? A woman who had settled here—I cannot give her name, because she would be embarrassed by the publicity—went to the Indian subcontinent and then returned to Britain. I think that at that time her husband was still on the Indian sub-continent. She was pregnant and when she went to the hospital about her impending confinement she was asked about the basis of her stay in Britain according to the form of questioning which is part of the proposals. Because the woman was rather alarmed about the implications of the British Nationality Act 1981—it may have been that she did not understand it fully—when she was asked whether she was staying here permanently she said that she was not sure, although she was settled here and had not been away for two years, so that under the immigration rules she had evey right to stay for the rest of her life. However, because she was disconcerted and ill at ease about the British Nationality Act she was unsure how to answer and she said something about not being quite sure and that she might or might not be going back.
What happened? She has been charged. I cannot understand how that can be an example of other than the way in which these charges have been wrongly applied, even according to the Government's stated intentions and the way in which the Secretary of State described those intentions to the Select Committee on Home Affairs.
Thirdly, there have been several instances—I have been given details of at least two—where the sponsor of a visitor to Britain has been forced to sign an undertaking to pay for NHS treatment before that treatment has started. On at least one occasion that undertaking was demanded in what I would only describe as the most stressful of circumstances. When the sponsor's father was on the point of being wheeled into the operating theatre the hospital authorities told the sponsor that he must sign an undertaking to pay. Presumably, the undertaking was for a person who was being treated and could not pay. This is an alarming example of how this particular scheme is being applied.
It is difficult to understand why the DHSS and the Minister are so reluctant to look into the workings of this highly controversial scheme. There was much argument up and down the country about it before it was introduced, and there has been much argument since it has been introduced.
I was in Birmingham last week with the Home Affairs Sub-Committee on Race Relations and Immigration. We were taking evidence on a totally unrelated point, but a black person described a series of events concerning his son who had been subjected to difficult and, in his view, discriminatory questioning in relation to the possible treatment for a broken arm at a hospital in the midlands. Examples of that sort have come to light time and time again. Our black population is very ill at ease and sees that as yet another example of discrimination being practised against them, even when they are absolutely within their rights to go for the Health Service treatment to which they are entitled.
I cannot help thinking that this is a bad scheme. Ideally, it should be withdrawn. It cannot be justified even by the arguments the Government have put forward. At the very least, the Minister owes it to the House and to the people affected by the scheme to ensure that his Department monitors how it is working. His Department should be able to say if the money is coming in, what the difficulties have been, whether the staff are co-operating, how many

hospitals are not taking part in the scheme, and what has happened to general practitioners. Labour Members have been forced to accept proposals which they dislike intensely. People up and down the country dislike the proposals intensely, yet there is no way in which we can get the answers to the many questions that we wish to ask about how the scheme is working.
I have written to the regional health authorities and am getting courteous replies from the majority of them. They are giving me the information that I require.
It is absurd that a Back-Bench Member of Parliament should have to write letters to regional health authorities simply to collect information which for a lesser cost the Minister's own officials could collect more easily and could keep collecting at intervals. Members of Parliament could then have information as of right about a scheme that is controversial. Will the Minister consider the plea that he should monitor the scheme so that he can tell the House how it is working, thereby enabling all hon. Members to come to a judgment on whether the Government' s aims for the scheme have been achieved.?

The Minister for Health (Mr. Kenneth Clarke): The hon. Member for Battersea, South (Mr. Dubs) has raised the question of the Government's new scheme for charging overseas visitors who are not ordinarily resident in this country for the hospital services they receive. It is by no means the first debate the House has on the subject. The new scheme that the hon. Member is debating has been in effect only since October last year. The House debated this subject comparatively recently when, following on an Opposition Prayer, it approved the Government regulations. I shall not again give the details of the Government's basic case for introducing the charges.
I remind the House that the principle on which we acted was that we thought it was right that overseas visitors from countries with which we had no reciprocal agreement should pay for their treatment normally by insuring themselves. That is the same basis on which British visitors, when they go to those countries, pay for hospital treatment that they may be unlucky enough to have to receive. I suspect that the bulk of the visitors about whom we are talking come from prosperous countries—American tourists, Australian tourists and visitors from the Gulf—who have a higher per capita income than our own. They also come from countries where British visitors and tourists are expected to insure against the costs of their own treatment.
Someone must pay for the hospital treatment that patients receive. We are generous in the treatment given to visitors in emergency and other circumstances. We freely enter into reciprocal agreements with many countries, but, if the visitor does not pay or insure himself, the British taxpayer must do so. Most British taxpayers would agree that it is perfectly reasonable for visitors to insure so that they can pay for themselves.
I do not believe that we are applying a system that would be regarded as unreasonable by the authorities of the countries from which the visitors come. The aim of the scheme is the perfectly worthwhile one of raising a little more revenue for the NHS. It also puts on a clear footing the longstanding arrangements that have applied to the NHS. Ever since the NHS was created, we have never had a rule whereby overseas visitors were as of right entitled to free treatment.
We tried to estimate the amount that would be raised following the introduction of a charging scheme. We used a figure of £6 million, which the hon. Gentleman will find was something of a guesstimate, although I always personally felt that that was an underestimate of the sum that could be raised for the NHS. A figure of 0·25 per cent. of services charged for would produce £7·5 million. We suspect that £6 million is, therefore, a reasonable expectation, although we have no means of knowing for sure, and I doubt whether the hon. Gentleman has any basis for knowing at this stage what exactly a full year will produce.
If we get £6 million or anything like it, that will be a welcome addition to NHS funds. The Government have steadily increased expenditure on Health Service provision of all kinds, but the hon. Gentleman would be among the first to argue that we could spend additional money in a perfectly worthwhile way. I therefore cannot understand why foreign visitors from countries with which we have no reciprocal agreement should not make a modest contribution to their own care when they are taken into hospital and are able to pay.
The hon. Gentleman has consistently been a critic of the scheme. He has been against it from the word go and has always thought that it should never have been introduced. He has sought evidence to show that he was right, that the scheme is not working and that all his fears have been justified. He has asked parliamentary questions to discover whether in the first three months of operation there is evidence to support his criticisms. The answer to his inquiry is, first, that we are not collecting centrally the informatiion he wants and, secondly, that it is far too early in the lifetime of the scheme to check any sensible statistics because the information is not readily to hand.
Not every district health authority has introduced the new procedures at the same time. In October last year, we were in the middle of the NHS pay dispute, which was a much higher priority on management and staff time. Most authorities now have the scheme under way, but it has been introduced at a time when the number of foreign visitors is very small. I also hope that those authorities are not devoting undue effort to checking the working of the system and collating the statistics.
I hope that they are ensuring that the guidance is followed properly, fairly and consistently, but I have no intention of organisng a massive statistical collecting operation, which would merely impose a high administrative cost. I cannot imagine that most regional health authorities have the spare management time to indulge in a close scrutiny of the monthly revenue returns from district health authorities. We have, however, asked health authorities to keep a separate record of any complaints arising from the scheme. We wish to be informed of these and in due course will ask for a return, but it is far too early to do so yet.
As for income from the scheme, figures for the first six months will emerge in autumn 1983. As I have said, however, I do not expect those figures to be fully representative, as the scheme was slow to get under way in some areas and the figures will relate to a period in which the number of foreign visitors was at its lowest.
Therefore, I do not believe that it is justified at this stage to start collecting the detailed statistics that the hon.

Gentleman requires or to reach any sensible conclusion about how the scheme is working in practice and how much revenue it is likely to raise.
The hon. Gentleman raised some specific and important points about events since the scheme was introduced and the way in which it has worked so far. He referred to the House of Lords decision in the case of Shah and others regarding the residential status of certain overseas students. I accept that there may be implications for the guidance that we have issued about charging of overseas students.
The legal basis on which overseas visitors may be liable to hospital charges depends upon whether they are "ordinarily resident" here. That has always been the term used in legislation governing the National Health Service. Their lordships actually considered a definition of "ordinarily resident" in the case in question. They rejected the "real home" test which had been used in the past and referred instead to the purpose of living in a particular place. The definition that they preferred comes from a judgment of Lord Scarman to the effect that a person should be judged as ordinarily resident here when, having regard to the purposes for which he is living here, he can be regarded as having established
a sufficient degree of continuity to be properly described as settled".
That is one random quotation from a judgment that the hon. Gentleman has studied. We must study it and consider its relevance to the guidance that we have issued and the practice that we have been following in relation to overseas students. I do not, however, accept the claim that some have been quick to make that all students are now exempt. To take an obvious example, I do not think that a person who comes here for a short language course in the summer could be regarded as ordinarily resident. Nevertheless, we may have to reconsider our advice about students. We shall try to clarify matters for health authorities as quickly as possible if we decide that the legal position established by the House of Lords requires a change in our guidance.
The hon. Gentleman described some cases in which he had been involved. For understandable reasons, he did not give names, and he gave inadequate information for me to respond to those cases. I am aware of one or two cases in which there were difficulties, but they did not match the information that he gave. If he will write to me about those cases, giving the names and details in confidence, I will give specific answers to the points that he raised on behalf of the complainants.

Mr. Terry Davis: If my hon. Friend the Member for Battersea, South (Mr. Dubs) wishes to send copies of his correspondence to me, I hope that the Minister will do me the same courtesy, as I am very interested in the allegations of discrimination. My right hon. and hon. Friends have brought other cases to my attention and I hope that the Minister will entertain those, too on a confidential basis.
I believe that the Minister inadvertently misled the House when he said in opening that the situation is still that the National Health Service provides generous treatment in emergencies. Certainly, treatment in accident and emergercy departments is still free. If an overseas visitor needs treatment for emergencies, such as a broken hip that requires treatment in an ordinary hospital ward, that visitor is charged—even though it is an emergency. I know of


several accidents involving broken bones where visitors have been charged substantial sums for treatment in hospital. That is a change arising from the Government's new regulations. Previously, the treatment would have been free, which was the policy of all Governments.
I understand the Minister's problem in answering questions on revenue. As he said, the scheme has been operating for only a short time and there are not many foreign visitors at this time of year. When will it be sensible to give a better idea of the annual income from the scheme? Will he please drop his statement that my hon. Friend the Member for Battersea, South is asking for a massive collection of statistics? He is asking only for a simple accounting report. The income is supposed to be accounted, and will be a separate item in the accounts. It should be relatively easy to provide an inexpensive report.
Will the Minister consider the costs? My hon. Friend rightly concentrated on the aspects of racial discrimination, about which the Opposition are worried, but we also wonder whether the revenue will justify the cost of the administration and clerical work involved. If the Minister is so confident that the revenue will be about £6 million, which will more than compensate for the cost of the scheme, will he refer the matter to the new team established under the leadership of Mr. Griffiths? One of its terms of reference is to consider the effective use and management of manpower in the NHS.
Will the Minister say a few words about the position of general practitioners? Is the circular ECN 473, which was issued in 1964, still applicable?

Mr. Deputy Speaker (Mr. Ernest Armstrong): Order. That was one of the longest interventions that I have heard. The hon. Gentleman had already addressed the House. He should ask for the leave of the House if he wishes to make a second speech.

Mr. Clarke: It was a long intervention. I had not realised that it would be quite so long, and did not note every point. I shall try to remember them and cover them in a way that allows me to return to my thread in answering the hon. Member for Battersea, South.
I have already covered the point about revenue. I said that in the autumn of next year we expect to produce the returns for the first six months. That will be subject to the proviso that some districts did not introduce the scheme quickly because of other problems. Also, the first six months will be winter months.
I decline to introduce any system of monthly returns that would be administratively expensive. We rely on the report of the working party—which recommended a scheme of administrative costs. It contained some administrators from the NHS and also representatives of ethnic minorities. Paragraph 38 of the report concludes:
Our proposals should be capable of being implemented by health authorities without any significant increase in administrative costs, and while in certain areas additional staff may be required to operate it, this should only be in hospitals where the additional income may be expected to exceed this cost.
I have not yet received any information to show that that advice and prediction have gone wrong. I am not aware of anyone having engaged additional staff. If we do attain anything like our modest estimate of income, it will far outweigh the administrative costs.
The hon. Member for Birmingham, Stechford (Mr. Davis) mentioned advice to general practitioners. We are considering that question and will issue advice in the not

too distant future. It follows naturally from our view on charges for hospital service that we should examine the long-standing circular issued to general practitioners to ensure that it complies with the law, is defensible and does not give rise to unnecessary difficulty for family practitioner committees, doctors and chemists. With regard to copies of the correspondence and the types of cases that have been cited, I shall reply to the letters that the hon. Members for Battersea, South and for Stechford sent me. We all accept that we are dealing with the names of the patients confidentially unless the patient has indicated otherwise.
I shall examine the case of the lady who came here to have her child. An error may have been made. We wish to detect it if one has been made. Nevertheless, as a general proposition, if, having followed our procedure, a hospital concludes that a woman is not normally resident here but has come here for the express purpose of giving birth to her child, quite a few ordinary British taxpayers will complain. They will maintain that, if we have no reciprocal arrangement with that country, there is no earthly reason why she should not pay for the treatment if she regards NHS treatment for the delivery of her child as so superior to that of the country from which she came. If she is normally resident, or the birth is premature or unexpected, other considerations of course arise.

Mr. Dubs: Our immigration rules are extremely complicated. The lady in question was settled here, had lived here without any restrictions and had gone back to the Indian sub-continent for a while. I think that her husband was working there. On her return to Britain, she faced these difficulties. As she had been living here for some years and was settled here, I do not think that the ordinary British taxpayer would feel that she was not entitled to NHS treatment.

Mr. Clarke: As, I think, we have agreed, the catch is whether the lady was ordinarily resident here. The hon. Gentleman said that she may have given some ambiguous or inaccurate replies to questions because she was worried on other counts. If, on examination of the facts, it appears that she was legally entitled to free treatment, we shall reconsider the case.
Other cases have been raised, such as those of people who have suffered accidents here and received emergency treatment. It remains the case that no charge is made in the accident and emergency department. Anyone admitted following a road accident or some other unexpected emergency is exempted, but he can be liable for charges thereafter when admitted for in-patient treatment.
That is not so startling or unjust. When a British person goes abroad—to the United States, for example—if he is wise—and we recommend it—he insures himself for hospital fees as he will be charged if he needs hospital treatment. We are trying to treat our visitors in exactly the same way as the British visitor is treated in the countries in question. I accept that we should be sensitive and sensible about the way in which the charges are collected. Sponsors and relatives may be asked to pay charges, but the first consideration will be that the proper treatment should be given.
We have no intention—we will try to protect against it and I do not think that it happens now—of going over to what occasionally happens in other countries whereby people who need emergency treatment are not admitted


and dealt with because consideration is being given to whether they will be able to pay for the treatment. Our guidance is quite clear. We say that the procedures adopted
must accord with normal principles of patient care. If staff have any reason to think that medical attention is required without delay, then that must take priority over enquiries into the patient's liability to charges or his ability to pay.
Those are the words of our circular. We have given clear guidance that should enable people to deal with accident victims sympathetically.
The final allegation is the most serious one that the hon. Member for Battersea, South made. He said today, as he has said in the past, that somehow the regulations and the policy that we have introduced are intended to be racially discriminatory. I shall not labour all the arguments that I used when the regulations were introduced, except to remind the hon. Gentleman that one of the reasons why we felt that it was necessary to tidy up the long-standing arrangements was that the working party, which included representatives of ethnic minorities, found that in practice the old system could easily become or seem to be racially discriminatory.
I quote from the working party's report when it studied how the old system, which some people want to go back to, was working. It said that the old system was so haphazard that it came to the conclusion that
because the checks currently used by many hospitals appear to be based on little more than the intuition of hospital staff that a patient may not be resident in this country, there is a distinct risk that they may be being applied in a way which discriminates against members of ethnic minorities living here.
Because the old system had the risk of being racially discriminatory in practice, we thought that it was necessary to bring in a new system and to avoid any danger of racial discrimination.
The hon. Gentleman has been supporting a most unfortunate organisation that is campaigning on the subject up and down the country, which calls itself the No Pass Laws to Health Campaign, a particularly ridiculous title, which I am afraid is used by a body that sends out fairly ridiculous propaganda, which, if read, would give the impression to many black and Indian residents that they were likely to be discriminated against when they went to hospital. The propaganda is based largely on almost direct misquotation or misrepresentation of the contents of our circular and the procedures being used. I will quote from one of its circulars, which was issued at the time of a conference addressed by the hon. Gentleman. It said that we were bringing in new regulations and that—
This means that if you are black or have a 'foreign sounding' name or accent, you may well find it more difficult to get NHS treatment because you may be asked to prove that you are entitled to it.
As I am sure the hon. Gentleman knows, every instruction given to health authorities and everything in the guidance is designed to ensure that the exact opposite is the case. That is a good description of the previous arrangements, which the Government have ended and which we have sought to clarify. The new arrangements ask exactly the same questions of people whatever their origin in the first instance by a sifting process, and thereafter questions are asked sensibly according to a set pattern that avoids the risk of any impression of racial discrimination. For instance, we expressly ruled out requests for passports, except for EC nationals and others

trying to prove quickly that they are entitled to be treated on a reciprocal basis because of agreements with their countries.
In contrast to what the No Pass Laws to Health Campaign says, our guidance says:
Ministers would find it totally unacceptable for the process of establishing identity to impose a special burden of proof on any group of people living in this country. It is important that the selection of patients for detailed inquiry must not be influenced by the personal characteristics of the patient—such as colour, accent or name.
We have had no complaints about racial discrimination arising from the regulations, as far as I am aware. The whole point of our guidance was to avoid any impression of racial discrimination being caused because the working party found that the old system was giving rise to just those dangers in practice. It is the old system to which the hon. Gentleman appears to want to go back. The new system is designed to avoid those dangers.
With regard to alarm being created among members of the ethnic minorities, alarm is not created by the Government or by anyone who has read our circular. If there is any, it is being caused by ridiculous and unhelpful campaigns such as the No Pass Laws to Health Campaign. It seems to me that the people behind the campaign are trying expressly to raise fears among the immigrant population that it will be discriminated against, by deliberately misrepresenting the terms of the policy, the way in which it is being applied and the advice that is being given by the Government.

Mr. Dubs: The Minister said earlier that I had alleged that the Government were deliberately introducing a racially discriminatory scheme. I was doing nothing of the sort, although I said that one consequence of the scheme would be that it would discriminate against black and Asian people.
I shall refer the Minister to a point made by the Secretary of State about passports. The Secretary of State gave evidence to the Home Affairs Sub-Committee on Race Relations and Immigration. He was asked about his assurances that passports would not have to be produced under the stage 2 procedures. He said:
No, because what I have said on passports is that it may well be for the convenience of the individual—if, for example, he comes from an EEC country—actually to establish, from his entitlement to free treatment, that he is a resident of Denmark or he is a resident of West Germany. Therefore, as in all things, I think that commmon sense has to be applied.
Although the Secretary of State quoted the EC as an example of from where a resident might be asked to produce a passport, he did not say that passports would not be asked for from people of other countries. The basis of the No Pass Laws to Health organisation was the fear that passports would be required before health service treatment was given free-of charge.

Mr. Clarke: Passports are relevant at stage 2, because they can be helpful for someone who comes from an EC country or some other country which has a reciprocal agreement. The quickest way for a visitor to prove that he is a national of a country which has such an agreement is to produce his passport.
Our guidance expressly sets out that, apart from those countries, passports are not be be requested, precisely because we responded to fears expressed before the scheme was introduced that people would be worried that it was part of an enquiry about their immigration status and so on. Passports, apart from this, are not particularly


relevant because access to free hospital services depends upon ordinary residence and not upon nationality or immigration status.
If I misquoted the hon. Gentleman when I said that he was suggesting that we were deliberately introducing racially discriminatory legislation, I apologise. He has not done so in his speech. However, he has appeared on the platform of the No Pass Laws to Health organisation helping to support its campaign. It is distributing leaflets typeset by an organisation called Bread 'n Roses (TU) of 30 Camden Road, London. It is being printed by Community Press (TU) in St. Pauls Road, London. I do not know whether that is a printing press of which the Labour party approves or disapproves. The hon. Gentleman knows perfectly well the scurrilous nature of the literature being distributed by the organisation. I shall quote one paragraph:
We can guess from what already happens in hospitals that ethnic minority people will be singled out for more careful questioning and will be more likely to experience delays before getting treatment. White people will not meet the same barriers.
Anyone, including the hon. Gentleman, who has seen our regulations and our guidance knows that their tenor and terms are designed to ensure exactly the opposite. The same questions are asked of everyone regardless of race, accent, name or anything else.
We are laying down a clear procedure that avoids the danger described in that leaflet, which existed before the Government acted. It is irresponsible to suggest that the new arrangements, which are designed to reduce the risk of racial discrimination, are causing greater racial discrimination. The campaign is not helpful.
I apologise to the House if I have used, even shortly, the basic arguments put forward in earlier debates about the scheme. They were accepted by a majority in the House. It is a common sense reciprocal arrangement giving some overseas visitors the same treatment that British visitors would expect in civilised countries abroad where one expects to insure and pay for treatment.
It is far too soon to have details of how the scheme is working in practice. It would be absurd to make detailed checks at this stage. We shall eventually have figures for the income and we shall monitor carefully any complaints that arise, including those raised by hon. Members.
I believe that a disproportionate amount of fuss is being made about a commonsense improvement to a long-standing legal position on entitlement to Health Service treatment. If it produces a little extra income for the National Health Service we should all agree that it is a good thing because the Health Service can use all the revenue that it obtains.

Orders of the Day — Arab Trade Boycott

Dr. M. S. Miller: I am grateful to the Minister of State for being here this evening, and I apologise for detaining him from some function that might have been of greater interest than listening to or speaking to the many hon. Members here this evening. The right hon. Gentleman and I have crossed swords many times. To use a religious analogy, it reminds me of the story of the Presbyterian minister and the Catholic priest who were talking on a train. The Presbyterian minister said, "Of course, there should be no differences between us, because we are both doing God's work." The Catholic priest replied, "Yes, that is true. You are doing God's work in your way and I am doing it in his way."
The Arab trade boycott of Israel has been described—I am sure that the Minister has heard what I shall say many times—as an economic menace, as a mere or a major nuisance, and even as a paper tiger. It was originally envisaged by the member states of the Arab League as an expression of their determination not to trade with the people who settled in Palestine many years ago, and their determination not to trade with the state of Israel, as it later became. However, the boycott grew wings, crossed frontiers and oceans and invaded almost every part of the world. Its purpose was, and still is, to engineer as far as possible a worldwide economic blockade of the state of Israel.
The origins of the boycott go back a long way and came about before the state of Israel was formed in 1948. Therefore, the blockade was not a response to war or to the occupation of territory. Its aim is to damage trade between Israel and the rest of the world, and thereby to damage Israel.
The boycott takes many forms. There is a primary boycott, in that the Arab League countries refuse to trade with Israel or to buy Israeli goods through third countries. They have done that since 1948, and I can understand it. They may do what they wish. Nothing in civilised behaviour determines that one country should do as another country demands. If Arab League countries do not wish to trade with Israel, they are perfectly at liberty not to do so.
However, a secondary boycott involves the blacklisting of firms outside the Middle East, for example in Britain, if such firms are held to be in violation of the boycott regulations. An analogy of the secondary boycott would be for the United States of America, which has banned trade with Cuba, to say that we in the United Kingdom could not enjoy nice Cuban cigars, such as I received this evening at a function. There is also a tertiary or voluntary boycott. Some countries outside the Middle East have, because of exaggerated fears of the boycott, refused to buy from companies that are on the Arab blacklist, even if they do not trade with Israel.
There is a fourth boycott—a self-inflicted one—which is directed against persons and institutions, the news media and other organisations. Not many years ago, a junior Minister at the Foreign Office wrote an excellent article entitled
Britain's trade, and the Arab blacklist
in which he said that many people were unaware of the pusillanimity of the British Government in helping industry to meet the challenge of the boycott. He referred


to the different boycotts—primary, secondary and tertiary. He mentioned the authentication of signatures by the Foreign Office and detailed many aspects of the boycott that affect Britain.
Britain has a proud tradition of freedom of trade overseas and, although officially disapproving of all trade boycotts which are not internationally sanctioned or imposed from Westminster itself, the underlying attitude of British Governments in this respect has been one of tacit and weak-kneed compliance, which has taken various forms.
The Department of Trade has issued directives in which disapproval of the Arab trade boycott is expressed, not vehemently, but in veiled terms. British firms are told to use their "own commercial judgment". Such advice is superfluous, since all companies use their own commercial judgment in their dealings not only with companies in Britain but with those overseas. The Arab boycott has political as well as economic connotations. The Department's phraseology suggests that it is not prepared to help firms coming under boycott pressure.
In addition, the Foreign Office is guilty of sins both of commission and omission. It expedites boycott documents by witnessing the signatures of notaries public—signatures that are required periodically by Iraq and some other Arab states. These notary public signatures accompany the so-called Arab "negative certificates of origin", which state that the goods to be exported to the Arab country in question are not wholly or in part of Israeli manufacture. I have here a copy of a certificate. Negative certificates are not acceptable to any reputable chamber of commerce, but the Foreign Office "defence" is that its own signatory will not actually have seen the contents of the negative certificate.
That brings me to a interesting point which I came across when looking at some papers some time ago. An hon. Member who was worried about this negative certificate tabled two questions to the Foreign Secretary asking for information about Government policy and requesting him to forbid officials of his Department from certifying or signing documents of a negative or discriminatory nature. He received a reply which he described as the gobbledegook of the Foreign Office.
The junior Minister who answered the questions confirmed that his officials were prepared
in accordance with international practice
to legalise documents required for presentation in foreign countries. He added that the Foreign Office legalisation certificate appended to such a document authenticates only the signature of the Notary public or other public offical, his seal and the signatory's capacity to countersign such a document.
The writer then said that the Minister stressed that the legalisation
does not relate to the contents of the document itself. The practice of the Foreign and Commonwealth Office in this respect is not discriminatory".
The right hon. Gentleman knows that the hon. Member to whom I am referring is the hon. Member for Edinburgh, Pentlands (Mr. Rifkind), who is now the Under-Secretary of State for Foreign and Commonwealth Affairs. The hon. Gentleman commented:
What a splendid lawyer's reply! What a lot of baloney!

The position is no different now. Other arguments apart, a notary's signature is the accepted final seal on a document and it does not need to be witnessed by anyone.
The Foreign Office fails to use its diplomatic good offices to assist British firms which have fallen foul of the Arab boycotters and which would wish to continue trading with Israel. A European country which has shown a more responsible attitude is the Federal German Republic. Its Government have helped firms coming under boycott pressure. A special example is the Volkswagen company, which was threatened with Arab blacklisting.
The British Government have avoided all forms of direct action against the operation of the Arab boycott on British soil and have therefore tacitly renounced a part of British sovereignty. Legislation that would have been perhaps similar to that of the American Administration has been rejected out of hand. It is well known that four years ago a Select Committee of the House of Lords recommended measures to curb Arab boycotting activity in Britain and that next to nothing has been done to implement the recommendations. Indeed, Her Majesty's Government have countenanced the circulation of boycott documents in Britain of the Arab-British chamber of commerce. This has been going on for over two years and is a direct violation of the chamber's undertaking, which was given shortly after its formation in 1977. It undertook that there would be no question of boycott declarations appearing on its certificates of origin. The same chamber now circulates negative certificates. It has circularised British firms informing them of probable blacklisting if they buy Israeli Government bonds.
Why should the British Government be so lily-livered about the Arab boycott? There are several explanations. First, there is the idea of Arab oil power. The suggestion that Arab oil does not matter because Britain is more than self-sufficient is said to be misplaced. Arab oil continues to be vital to Britain's European trade partners and Britain, too, would be hurt if the Arab oil weapon were used against Western Europe. British Governments take a cautious view of the prospect of Arab oil power declining, for if and when the world economic recession ends the demand for oil will escalate. That is one viewpoint. That is one of the arguments that is advanced by the Foreign Office.
The second argument is based on Arab petrodollars. There are massive Arab investments and bank balances in Britain. The pound sterling has been weak for some time and it has never been weaker than today. The withdrawal of a substantial part of Arab funds could have a shattering effect on the British economy. Another argument hangs on Arab markets. They are of tremendous importance to British exporters. As a result, a new and powerful lobby has emerged. It is led by interests involved in armaments, construction, engineering and electrical companies. Firms in these sectors conform readily with Arab boycott regulations. This gives the Arabs great confidence in making ever more outrageous demands.
There are military-strategic considerations. It seems that the Western Alliance and the Foreign Office take Israel for granted as part of Western defence or Western interests and therefore there is no need to do anything to bolster that state of affairs because it is there to be had if necessary.
Britain is not the worst offender in selling arms, but it has joined other European nations in pouring arms into a


highly combustible area. The arms market is highly competitive, so the desire not to offend Arab Governments is heightened.
There is the mentality of what is known as the British establishment, which is well known. Hugo Young, in an excellent article in the Sunday Times two weeks ago, talked about the Franks report as being the Establishment talking to the Establishment. We all know what this is, and there is a lingering feeling that Britain has a special role to play in the Arab world because of supposedly worthwhile relations in the past.
This feeling is strongest on the Foreign Office, and has an undeniable effect on foreign policy. Its corollary is not to offend the Arabs. This led to the relatively recent visit to Riyadh of the former Foreign Secretary to assuage Saudi anger over the film "Death of a Princess", which was shown on British television. It leads, too, to the readiness of the Foreign Office to play ball with the Arabs over the boycott.
I can remember a case in 1968, concerning a close friend of my youth—we were in the same boy scout group. He was a little older than I and was in the Army when I was still in medical school. He left the Army, went into the consular service and then to the diplomatic service. He became Sir Horace Phillips. Sir Horace was appointed by the British Government as the ambassador to Saudi Arabia. He was accepted until the Saudis found out that he was a Jew. There was nothing to be done about it, and his credentials were withdrawn. Sir Horace had spent his whole life in the Islamic world and could speak perfect Arabic in a number of dialects, but the British Government had to accept this humiliating outcome.
These factors have contributed to the British singular, and even exceptional, weakness in the face of the boycott. In no other European country is there a more widespread secondary boycott—the Arab blacklisting of British firms which continue trading with Israel and which receive no protection from Whitehall. However, there is also a tertiary boycott—a boycott of British firms which trade with other British firms already blacklisted. This is a very intricate ball game. In no other European country is there a more widespread voluntary boycott, entailing spontaneous application to the Arab boycott offices for forms to fill in and negative certificates of origin to be completed. There is a veritable deluge of these, because the British Government do nothing to discourage the practice.
Only occasionally do cases of this kind come to light, because neither the Arab authorities nor the British firms concerned wish to advertise their actions. A number of recent cases have come to light of the actions of British firms. For example, the Berger paint company broke off relations with a Tel Aviv firm, Autotrade, causing the latter substantial losses. Berger refuses to admit that this was due to Arab pressure, which its manager euphemistically managed to translate into "extraneous reasons."
Teleconsult, a subsidiary of the Government-controlled British Telecommunications has given assurances that it will do no business with Israel. BT's policy is almost certainly influenced by negotiations between the Ministry of Defence and Saudi Arabia for a £200 million contract for a communications network in that country.
Another British firm, Transcall, broke off relations with the Israeli firm of Teletron for what it called "obvious reasons," but it obstinately refuses to disclose them.

Perhaps a more strikingly disgraceful case is that of a British supplier of bandages to a Jerusalem hospital, whose general manager was reported as saying that
as far as I am concerned, Israel does not exist.
Then there is the bank—the case is still under discussion—whose cheques carry on the reverse side the rubber stamped statement:
Negotiable in all countries of the world except Israel.
Surely that is as blatant an example of discrimination as one could imagine.
A leading construction company indulges in what is, almost certainly, a "voluntary" boycott by filling out negative certificates of origin for equipment sent to Oman.
There is a host of less important examples that I could cite in which British firms have given way to Arab pressure. British Airways publishes a "Middle East Pocket Brief", whose map simply omits Israel altogether. In addition, the DHL courier service claims to be "world wide" in its brochures, but refuses to do business with Israel, allegedly because of specific Arab pressure.
Bartholomew's, perhaps the world's leading cartographers, sells maps of the Middle East in Arab countries that show Israel as Palestine. That is more than a pin-prick, for a cartographer should be totally committed to producing truthful and accurate maps, and the Arab boycott offices can only take encouragement from the firm's genuflection to Arab foibles. There are Arab countries that have lost practically all interest in the boycott. I refer to such countries as Lebanon, Sudan, Tunisia, Morocco and most of the small Gulf states. There have also been successes in resistance to the boycott. Barclays Bank and Lonrho have refused to bow to boycott pressure. After some negotiation, Grand Metropolitan repudiated the action of a subsidiary that had bowed to Arab pressure.
A leading property company, MEPC, was exposed over its dismissal of a Jewish employee during negotiations for large-scale business with Kuwait. An industrial tribunal found that his dismissal had been unfair and the consequence of unlawful discrimination for racial reasons. It is not only a question of refusing to trade with Israel. Very nasty and dangerous symptoms of anti-semitism are creeping in. Arab countries have refused to do business with companies with Jewish directors on their boards. Sometimes, firms have firmly but courteously refused to give way to boycott pressure and have continued to do business with both Israel and Arab countries.
The main object of countering the boycott is to enable business with Israel to carry on and prosper. That is all happening now. Excluding the probably temporarily depressed trade in diamonds, British exports in 1982 were about 50 per cent. higher than in the previous two years. Israeli exports to Britain in the same period rose by about 16 per cent., giving Israel a favourable trade balance of just about £50 million. However, British investment in Israel still lags and that may be the most serious consequence of the boycott, although it must be added that Britain's actual share in an expanding Israeli market has been halved since 1975. British Government offices, however, would point out ruefully that that is also happening in some of its other foreign markets.
The Foreign Office views world situations from the standpoint of how they appear to be. Foreign Office analyses are superficial, their conclusions concerned with British interests as it sees them, to the exclusion of almost every other consideration. I do not quarrel with the view


that British interests are of the utmost importance, even paramount, but the pundits of the Foreign Office have a blinkered view of what constitutes British interests, and a long history in the Middle East of equating Arab interests with those of the United Kingdom. It takes a short-term view and a totally inadequate appraisal of the longer term. Fairness, justice, moral obligations and dignity play little part in its deliberations.
Let us consider how the situation changes. The oil blackmail weapon, which I mentioned a moment ago, no longer exists. There is a glut of oil. In spite of what the Foreign Office may say, experts are of the opinion that the oil glut will continue for a considerable time. Some say that not only will it continue for a considerable time but that the possibility of blackmail by oil is gone for ever. That is due to more than the recession. First, the world has gone in for conservation. For the first time, the Americans are serious about the development of small cars. They are running smaller cars, now that they produce them. Secondly, other sources of energy have been substituted for oil, such as coal and nuclear power. France, for example, now produces 40 per cent. of its electrical energy from nuclear sources, and by 1990—only eight years from now—it will be producing 72 per cent. I was told only three months ago by the director of the nuclear energy agency of the OECD that no OECD country is now building an oil-fired power station. So things change, and what the Foreign Office believes is in British interests today or tomorrow, may not be in British interests next week.
Only a handful of countries have passed legislation to discourage the totally unethical operations of the boycott on their soil. Arab boycott offices have sought to interfere with the normal trade with Israel of foreign firms, have wasted their time and money, and have flagrantly violated the principles of free and fair trading and the rules of organisations such as the European Community and GATT. Only the United States of America—and, to some extent, Canada—has legislated to make it mandatory for American firms to report all boycott-related transactions, fining those firms that fail to do so. Even Governments of the most democratic industrialised countries have done no more than express a pious disapproval of blatant Arab interference in their economic affairs. For Israel that is disappointing. Her trade partners should stand united in resisting economic blackmail.
I admit that there are faint hints of a change in governmental attitude. Last May the then Chief Secretary to the Treasury promised to look into the matter of the Foreign Office expediting negative certificates of origin. In August the present Minister of State stated that Government policy vis-a-vis the boycott was under review. However, I am afraid that when the Prime Minister is not concerned, the wheels of government in Britain grind exceeding slow. The Prime Minister has been absorbed in other matters, such as the British contributions to the Common Market, the East-West confrontation on nuclear arms, and the Falkland Islands conflict. When she does not put her foot down, it seems that the Foreign Office proceeds along its leisurely way.
It is not enough for the Government to express disapproval of the boycott. They should officially and actively discourage compliance with it. Government Departments, offices and institutions should be instructed

not to comply with the boycott. This should also apply to nationalised industries and companies in which there is a majority public interest.
The Foreign Office should cease authenticating signatures on discriminatory certificates of origin. I do not accept that this would be
an unacceptable risk to our exports.
There should be a legal obligation on British firms to notify the Department of Trade of any boycott requests or demands that they receive and whether these have been complied with. Such reports of compliance should be open to public inspection. Compliance with the secondary boycott should be made illegal. This would enable British business men to give a prompt and effective response to boycott pressure.
If the Minister does not accept these points, I should tell him that they are exactly the points that his hon. Friend the Member for Pentlands made five or six years ago in an article in The Times. The actions that the hon. Gentleman recommended should be taken. They could not be expressed better today. Hon. Members may have seen on television the German film "The Oppermanns".

The Minister of State, Foreign and Commonwealth Office (Mr. Douglas Hurd): It is a very good programme.

Dr. Miller: I am glad that the right hon. Gentleman agrees. The scene of the boycott of the Jewish firm of Oppermanns was horrendous. Hundreds of brown-shirted thugs, with their Nazi armbands, carried placards of hate and shrieked commands to the crowds in the street not to buy from Jews. The stamp on the shaved head of the woman who defied the order read, "I am a traitor to Germany because I bought from Jews." That was only slightly less obscene than the stamp on the forehead of the patient in bed which read, "I am a traitor to Germany because I was operated on by a Jew."
This is the viciousness of the boycott. I implore the Minister to stop it now before it reaches the stage that it reached in another country.

Mr. Greville Janner: I congratulate my hon. Friend the Member for East Kilbride (Dr. Miller) on his initiative and on his presentation of a well-known case. One reason why I venture to take part in the debate is that I have been campaigning for years, together with hon. Members on both sides of the House, to try to induce successive Governments to change their attitude towards the boycott and to cease authenticating boycott documents. Secondly, I relished the thought that the Minister and I might find ourselves on the same side on a Middle East issue, to the shock and horror, and perhaps dismay, of the right hon. Gentleman.
It is also an enormous pleasure to be able to speak on the Middle East while the howling hyenas, my hon. Friend the Member for Dundee, West (Mr. Ross) and the hon. Member for Northampton, North (Mr. Marlow), lie in their beds in their lairs, presumably, and while there is no one else trying to shout me down on an issue where too often too many are too vocal and too stupid. They have perhaps chosen a good issue on which to be silent, because there is so little for them to say. They may fear hard work or late hours, but it is the fear, I believe, of presenting a case that is basically intenable that has kept them from the House tonight.
I know that the Minister will treat seriously the complaints that have been made so eloquently by my hon. Friend the Member for East Kilbride, and which I shall seek to put in other forms, not only for their own sake but because they reflect a sensitivity to discrimination of a peculiarly evil kind which is extremely bad for the United Kingdom's trade and traders and contrary to the spirit, activity, trends and traditions of Britain's commercial interests. That is the matter which should be of primary concern to the Minister.
It has always been the proud symbol of Britain that British firms should trade without hindrance with any country with which we have friendly relations. As far as I know, there has never been any other case where any United Kingdom Government have played any part in any discrimination in trade against a fellow democracy with which we have full diplomatic relations. This is a sole, unpleasant and shameful anomaly in an otherwise proud tradition and I trust that the Minister will not try to make light of the part that the Government—alas, in common with their predecessors—are playing in this process by lending their weight and apparent approval through the authentication of boycott documents.
The first essential for the Minister to understand is that a discriminatory trade practice against a friendly democracy is impossible to sustain or to justify and that no Government of this land should have any part of it. Secondly, he should recognise that the authentication of boycott documents may, in strict dogmatic fact, be a mere authentication of signatures, but in reality it is taking a step in boycott procedures which is an encouragement to those who would sustain that evil practice and a discouragement to those who seek to oppose it.
My hon. Friend has referred to the three levels of boycott—primary, secondary and tertiary. I share his views, but I would take the step one ricochet further. It is not so long ago since the Mancroft affair when the noble Lord was excluded from the board of an insurance company which saw fit to try to get rid of him because it wished to have a "Judenfrei" board in order to do business with Arab countries. It was the public outcry against that company which caused it to change its methods and procedures.
It is only months since the case to which my hon. Friend referred of the property company which saw fit to dismiss its company secretary because he was Jewish and it wished to do business with Arab lands which objected to Jews on its board.
The Minister should see that it is a short step between saying that we will not trade with those who trade with Israel to saying that we will not trade with those who have Zionists on their board, and that, in the parlance of the extreme Left and of the extreme Right, means Jews on their boards. Indeed, as most Jewish people are Zionists, there is an element of truth in that too. But in Britain, it is a proud and great tradition that we do not discriminate against people in our commercial life because of their religion. It is the law of this land that it is not permissible to discriminate on grounds of race—and that means race, nationality, colour, or ethnic or national origin. It should surely be against the law of the land to permit discrimination against companies because they refuse to discriminate in their trade with the Jewish state.
Of course it is up to any country to decide with whom it will do business. It is up to any company, any firm, any commercial concern, to make its own decision. But when

it attempts to impose a boycott decision on others, it creates a discriminatory practice which I am sure the Minister will condemn.
When another country says to a company or a firm in this land, "We shall not trade with you if you trade with our enemies," that is a form of discrimination. When the Government say, "We will authenticate documents which show that you are complying with our boycott list," the Government are partaking in the boycott. It may not be direct participation, but that is very close. Indirect participation in an evil practice leaves the stain of complicity upon those who take part in it.
The sensitivity which my hon. Friend and I share reminds me of the celebrated remark of Henry Kissinger which the right hon. Gentleman may have heard, when, as Secretary of State, he said, "I may be paranoid, but that does not mean that I haven't got enemies." There is no true paranoia amongst those who fear the boycott as an insidious beginning to an evil end. Even if there were, it is the growth of enmities that has produced the boycott.
The right hon. Gentleman's colleagues in the Department of Trade and Industry encourage trade with Israel. It surely is a curious anomaly that his Department should play a part in any effort by anyone to discourage that trade. It is, alas, a part they do play.
We should praise those firms that have stood up to the boycott. There is no loss of trade for any of them that have spoken firmly and have determined that they are not prepared to give way to what my late and revered father used to call "blackmoil"—which in the days of oil plenty can simply be called "blackmail".
All praise to those businesses which have declared that they are not in any circumstances going to have anybody tell them with whom they may and may not do business. It is for each person, company, country and firm to decide whether it will do business and with whom, but not for them to discriminate or to cause discrimination in the practices of others.
There was a feeling among Governments of the United Kingdom that it would be wrong to take the lead in anti-boycott legislation or to take steps such as the hoped-for refusal to authenticate boycott documents which would show that the denunciations of the boycott were no mere bleating in the dark.
There is no longer that excuse. As my hon. Friend so rightly pointed out, we would certainly not be the first country to take that step. I ask the Minister to state in his reply whether he knows which other countries have passed such legislation. Is he aware of such countries? If he does know, he will appreciate that it is not just transatlantic lands that have decided that they will not permit this kind of discrimination against their firms, but also some European countries. My guess is that he does not know, but we shall no doubt soon hear. If he does know, the House is entitled to inquire whether he has read the report of the Select Committee in the other place headed by Lord Byers, whether he has considered the recommendations it made; and whether he is prepared now to commit the Government to compliance with such recommendations. If not, why not?
I know that if he follows the lead of those who have sat in his seat previously, the right hon. Gentleman will denounce the Arab trade boycott against the only democracy in the Middle East. I hope that he will not merely denounce the boycott but renounce authentication of boycott procedues. I hope that he will build a small


bridge with a country, with which there are many differences of opinion but which is a trading partner. I hope that he will do so by dissociating the Government actively from any part whatever in a procedure that successive Governments have denounced as contrary to the interests of the United Kingdom.

The Minister of State, Foreign and Commonwealth Office (Mr. Douglas Hurd): I congratulate both hon. Members, but in particular the hon. Member for East Kilbride (Dr. Miller) on the way in which he has used this opportunity. It is not an entirely novel subject, but it can always be treated in a new way. That is what he did this evening.
The hon. Gentleman used the opportunity to range fairly widely over a number of matters, such as Sir Horace Phillips 15 years ago, but he will forgive me if I do not follow him down all those byways. He gave a number of reasons, some of them pretty fanciful, for the stance that successive Governments have taken and then proceeded to knock them down.
I want to confine myself briefly to restating what our policy is and to outlining the reasons for it. As the hon. and learned Member for Leicester, West (Mr. Janner) fairly said, Government Departments encourage trade with Israel, as with other countries, and we are glad that our exports to Israel last year amounted to £220 million. That is a sizeable figure. The Department of Trade actively supports the British Overseas Trade Group, particularly the advisory group, which spends much energy promoting trade with Israel.
As has often been stated, we dislike the Arab boycott and wish that it did not exist. But the real question that British Governments have had to face is whether we should take powers through this House to prevent British firms from following their own judgment—whether we should restrain them. We have come to the same conclusion as previous Governments, including the Government supported by the two hon. Members. We do not think it right to legislate to constrain the commercial judgment of firms.
It is perfectly true, as the hon. and learned Gentleman said, that, having looked at the matter, other countries have come to a different conclusion, but, as the hon. Member for East Kilbride said, such countries are relatively few.

Mr. Greville Janner: Will the right hon. Gentleman be good enough to say which countries have legislated against the boycott?

Mr. Hurd: I should like to deal with that when I discuss authentication, because that is the issue on which both hon. Members have pursued us with the greatest zeal. At present I am discussing whether it would be right for this country to take powers to prohibit British firms from following their own judgment. I do not believe that there would be a general feeling, either among firms or in this House, that it would be right for us to legislate and to take those powers.
I have read the report of the Select Committee in another place, but I believe that the authentication issue has been raised out of its proper proportion. The impression is sometimes given that it is some special

procedure whereby the Foreign Office goes out of its way to provide this facility for British firms wishing to comply with the boycott and thus that we are somehow lily livered and comply with a policy to which in theory we object. As the hon. and learned Member for Leicester, West knows, the nationality and treaty department of the Foreign Office authenticates signatures on a large number of documents going abroad. That is done as a public service and it is an authentication of the signature, not of the document. It is no use the hon. Member for East Kilbride suggesting that that is pedantic gobbledegook. It is a statement of fact. That is what the authentication is.
Nevertheless, as there has been, not misrepresentation, but widespread misunderstanding of that point, we have taken action to remove any uncertainty. Just in case anyone really believed that the authentication of a signature in some way gave encouragement to the boycott, we have introduced a document to make the point clear, to remove any possible misunderstanding and, we hoped, to prevent hon. Members from continuing to sing this ancient tune. Every certificate now states that authentication of the signature
does not imply that the contents of the document are correct or that they have the approval of the Foreign and Commonwealth Office".
It is well-known procedure applying to all kinds of legal documents that that which is being authenticated is the signature at the bottom and not the contents of the document. I suspect that the hon. Gentleman knows all this thoroughly from A to Z, and it is unfair of him to continue to mispresent the practice as he has.

Dr. M. S. Miller: The Minister is surely not so naive as to believe that no one would regard the authentication as some kind of imprimatur. It must be within his knowledge that that is exactly what some people want. If it is of no value, why does the Foreign Office do it? Why does it not tell the firms that ask for authentication that it is of no value, that the notary public who has signed the document requires no witness of signature, and that they should tell the companies that are pushing them that the British Government will have no part in it?

Mr. Hurd: The hon. Gentleman persists in taking the point wrongly. What may be of value is the authentication of the signature—certifying that the person who purported to sign the document was indeed that person and no one else and that he held a particular position. That is the nature of the authentication. It has no further significance. Moreover, in case there should be any doubt, a statement is now attached to every such document stating that the authentication has no further significance than that, so that really is a false point.
Neither the hon. Gentleman nor his hon. and learned Friend mentioned the very practical point that the great majority of the signatures are not authenticated by the Foreign Office nationality and treaty department at all. I cannot give an exact figure, but we believe that only about 10 per cent. are authenticated in that way. The great majority are authenticated not by us but by the Arab-British chamber of commerce, to which the hon. Gentleman referred.
It would be wrong to suppose, as did the hon. Gentleman, that we would alter significantly the effectiveness of the boycott by refusing to authenticate the signatures in the Foreign Office. That is an important


practical fact. The effectiveness of the boycott and the changes proposed need further study than that evident in the speeches tonight.
What would be the practical effect on the boycott if we complied with the hon. Gentleman's wishes and if the 10 per cent. of signatures that are authenticated were taken to other places? That is a legitimate matter, and one which we are now considering. For some months we have been reviewing the practice. The hon. and learned Member for Leicester, West likes to present the policy as something that the Foreign Office dreamt up and administers, despite the more practical views of others. That is not the position. If we are to review the policy, we must take into account the opinions not only of Departments in Whitehall, not only of the House, but of a large number of people and groups who have legitimate interests, which vary according to their position. The review has been announced to the House. I cannot announce its conclusion today. It is a genuine review and the House will be informed of our conclusions.

Mr. Greville Janner: The Minister promised that, when he dealt with authentication, he would talk about other countries where the practice has been banned. As part of his consideration, has he discussed these matters with those countries with which we are trading partners?

Mr. Hurd: I agree that I undertook to give the hon. Gentleman some information on that point. The United States has anti-boycott legislation. France, the Netherlands, Italy and Luxembourg carry out authentication through the Arab chambers of commerce, without the involvement of Government. The procedure followed in Denmark, the Federal Republic of Germany, Belgium and Ireland is similar to our own, although in the first two cases there are certain restrictions on negative certificates of origin. The position in Greece is unclear, but we do not think that the Government there, would take a strict line against the boycott's operation. There is a wide range of practice within our partners in the Ten, and nothing approaching a common view.

Dr. M. S. Miller: The Minister is dealing with a country that not only has friendly relations with Israel but

is a democratic country to which we should be pushing exports. It has a surplus balance with Britain and could take a lot more. Does not he think that he should be examining the position with the view of trying to increase exports to that country?

Mr. Hurd: As I said earlier, that is one of the purposes of our trade policy and one of the factors that must be taken into account. I do not deny that. However, it is not the only factor. It is a serious effort by the different Government Departments and the different Ministers to reconsider the matter. It was suggested by Lord Carrington after his visit to Israel. We are taking the matter seriously. It is not easy. I do not believe that Opposition Members haw, thought through what would be the effect on trade if we stopped the practice of which they complain. They might do a little research into that. It is one of the matters that worries us. We are examining the matter seriously and will report to the House.
The final point, into which I would not have gone if the hon. and learned Member for Leicester, West had not ended with a pereration, is that the boycott comes about as a result of a long-standing dispute between Israel and some of her neighbours and other Arab countries. The dispute has gone on for so long that it has bred a deep sense of insecurity and injustice on both sides. The hon. and learned Gentleman gave us an eloquent explanation of the sense of unjustice that is felt, not only by Israelis but by some hon. Members, about the boycott. We all know, because we hear it from the gentlemen of England now abed to whom he referred. We also know that there is a deep sense of insecurity and injustice because of certain actions by the Government of Israel which they regard as an affront and intolerable. We are discussing a ripple of that dispute.
The boycott will not be ended by any action or inaction by this Government. If we really want to get rid of the boycott and the feelings that give rise to it, the two hon. Members who have spoken should join us in our efforts to help settle the dispute once and for all, as that is the only way.

Orders of the Day — Nuclear Missiles

Mr. William Rodgers: Pleased though I am to be able to raise this subject, I am astonished at the failure of the Secretary of State for Defence to be present, I heard accidentally that he would not be here because he is making a political speech in Berkshire. In view of the importance of the subject, which has been raised many times and will arise again, his absence is a dereliction of duty. I say that in the presence of the Leader of the House and with no disrespect to the Minister of State for the Armed Forces whom I have known for a long time, like personally and would be more than happy to see on every other occasion. It is arrogant behaviour by the Secretary of State, and it is not what the House should expect from a new Secretary of State.
I deplore the absence of the Secretary of State because of the high political importance of the dual key, or the double safety catch as it is sometimes called, on American-owned cruise missiles in Britain if they are deployed here. It will feature increasingly in debates in the House and in public about defence policy. It is a reflection on the procedures in the House that discussion of a subject of this type is dependent on the luck of the ballot on the Consolidated Fund Bill, archaic as it is.
Apart from set-piece confrontations in the House that deal with virtually all aspects of defence policy, there is precious little opportunity to examine detailed subjects seriously. There is a conspiracy between the Government of the day and the official Opposition. Conservative Governments like to make a mystery of defence and treat even trivial matters as though they are highly classified. The Labour party believes that the less said, the better. Bearing in mind the fundamental differences of opinion on defence policy in the Labour party, it is, if anything, even more secretive when in government.
If one wants to learn about defence policy—this has been the experience of hon. Members on both sides of the House—one must go to Washington to talk to the United States Administration, because it will talk more freely. One might also go to an American university, as defence policy is studied seriously there.
The Select Committee on Defence—I say this with regret, as I strongly support our system of Select Committees—has shown much less tenacity in its single-minded pursuit of truth than other Select Committees. Sometimes it has behaved as if it were the Ministry of Defence's poodle. I remember some years ago a permanent secretary at the Ministry of Defence complaining to me that meeting the requests of the Select Committee involved the employment full time of an assistant secretary. At that time, the Ministry of Defence had over 100 assistant secretaries, but he failed to see the irony of his complaint.
I should like to believe that this short debate, even in the absence of the Secretary of State, will move the House in the right direction. A fuller and more open discussion of defence issues is wholly in the public interest. It is all very well for the Secretary of State for Defence to talk about an advertising campaign, but if the Government's case—or any Government's case—on nuclear matters is good, there is no better way of proving it than through argument in the House.
The deep public concern about defence policy—there is no doubt about it, whatever view one takes about how the matter should be resolved—and the growing demand for unilateral disarmament stem partly from the failure of successive Governments to come clean, face their critics in the House and explain the conclusions that they have reached. The issue of dual key illustrates the point perfectly. Perhaps it is naive of me to suggest it, but I still hope that the Minister of State will be franker with the House than either the Prime Minister or the Secretary of State has been so far.
I shall make plain my view and that of my right hon. and hon. Friends on the deployment of cruise missiles, so that there will be no misunderstanding. We believe that the twin track decision of NATO taken in December 1979 was right. I said as much when the initial statement was made in the House on 13 December 1979 and I said it again in the debate on 24 January 1980. My remarks were made on behalf of the official Opposition, for which I was then the defence spokesman. The Labour party has changed its mind, but I have not.
The account in this week's Sunday Times of the Labour Government's approach to theatre modernisation is substantially correct. It mentioned the so-called Mulley letter of August 1977 and reminded us of what Vice-President Bush has been saying in the past few days, that both the Federal Republic of Germany in the person of Chancellor Schmidt and the British Government wanted new theatre nuclear weapons. The United States Government responded to the wishes of their European allies. We should remember that when the Americans are somehow blamed for now wanting to deploy cruise missiles in Britain in the way in which they were asked to do.
The decision of December 1979 was right. It would have been supported by a Labour Government and I endorsed it in the House on behalf of the Labour Opposition with the previous Prime Minister, the right hon. Member for Cardiff, South-East (Mr. Callaghan), sitting beside me. Unlike the present Leader of the official Opposition, he was then and remains a robust advocate of the Western Alliance and all that that means.
Neither I nor my right hon. and hon. Friends want cruise missiles deployed here. We still hope that it will never happen. That was the nature of the twin track decision. I made it clear three years ago that the period up to the date fixed for the deployment of cruise should be used for negotiations, which I hoped would succeed. It was a disappointment when events in Afghanistan cast a shadow and a new American President was slow off the mark in seeking serious disarmament negotiations with the Soviet Union.
It was also a disappointment, although not a surprise, that the Soviet Union continued to deploy SS20 missiles and made no serious negotiating proposals. My right hon. and hon. Friends and I welcome signs that such negotiations are at last starting in the Geneva talks. Both sides are now showing flexibility. We want substantial and verifiable reductions of SS20s and Mr. Andropov appears to be willing to move in that direction if the United States does not lock itself into the zero option.
We do not want cruise missiles deployed here, but if the disarmament talks fail eventually, the circumstances in which cruise missiles would be deployed would become


an important question. There is a strong case on merit for a dual key on cruise missiles. There is a stronger case for reassuring the public.
It is right to clarify what I mean by a dual key: no cruise missile could be launched, or a warhead armed, without explicit decisions by both the American President and the British Prime Minister, separately conveyed and implemented in the firing system by United States and United Kingdom personnel.
The idea of a dual key originates in the so-called dual lock adopted by the United States strategic air command in the early 1950s to govern the launch of the Minuteman. It is a physical device and the procedure, with some modifications, applies still to all United States nuclear weapons in Europe. It is relatively simple to adapt that procedure to involve two nationalities. There are electronically controlled dual-key arrangements on Lance short-range missiles and on other nuclear weapons, as the Minister knows, which are deployed in Europe and are activated by both American and Western European officers.
At the moment there is far more fog around the precise arrangements for cruise than there was about the deployment of four intermediate range missiles in Great Britain between 1959 and 1963.
In the aftermath of Suez, the newly installed Prime Minister, Harold Macmillan, set out to patch up relations with the Americans and establish a new partnership in defence matters. The relevant part of the Bermuda agreement of March was endorsed by the NATO council at its meeting in December, 1957. A bilateral agreement was signed eventually on 22 February, 1957 and published as Cmnd. 366 in 1958.
The White Paper referred to the location and deployment of the four missiles and said that they would be manned and operated by United States personnel and that the warheads would remain in full United States ownership, custody and control, in accordance with United States law. However, paragraph 7 of the relevant part of the agreement states:
The decision to launch these missiles will be a matter for joint decision by the two Governments.
As a result, there was a dual key with an American key activating the warhead and a British key activating the missile.
That system, based on the so-called permissive action link, remains the basis for joint physical arrangements when the United States deploys nuclear weapons in Europe under co-operation programmes.
the nub of my argument is that I do not understand why that system cannot be adopted and, if necessary, adapted for cruise. The Prime Minister, and the Secretary of State for Defence and his predecessors, rest their case on the Attlee-Truman agreement, but so far they have been far from precise and not always consistent.
When the former Secretary of State for Defence, now the Foreign Secretary, made his statement in the House on 13 December 1979 I mentioned a dual key. I asked about the consultation process. When the right hon. Member for Cardiff, South-East pressed the matter, the Secretary of State said:
The same arrangements for consultation will continue that have existed heretofore."—[Official Report, 13 December 1979; Vol. 975, c. 1552.]
It is fair to say that he seemed less than familiar with the exact arrangements.
The idea of consultation persisted for some time in the replies of Ministers, but the Prime Minister now refers to "joint decision arrangements". As for the new Secretary of State, he said in the House last Tuesday:
The use by United States forces of bases in this country in an emergency … would be a matter for joint decision between the two Governments in the light of circumstances of the time.
We should note the reference to "bases". There is no reference to the firing of missiles. If it means the same thing, the Minister of State should make that clear tonight. Does the reference to the use of bases imply and involve the firing of missiles?
Last Tuesday, the Secretary of State went on to read from the communiqué issued in January 1952 following discussions between Mr. Churchill and President Eisenhower. That also refers to
the use of these bases … in the light of circumstances at the time."—[Official Report, 1 February 1983; Vol. 35, c. 133.]
The Prime Minister and her Ministers now rest simply on those arrangements of more than 30 years ago. but before we know whether they are satisfactory, we should at least know what they are.
I mentioned the Thor agreement, which said that the launch of the missiles would be a matter for joint decision. I stress the word "launch". That agreement was reached in 1958, but the Prime Minister relies on the agreement of 1951. I must assume that there is a difference between the use of bases—the formula for cruise—and the decision to launch the formula for Thor. But there is further confusion. In the fourth volume of his memoirs, "Riding the Storm", Harold Macmillan gives an account of the Bermuda agreement and the agreement on the stationing of Thor. He describes a further visit to the White House on 9 June 1958 for a conference with President Eisenhower, and says:
The President and I initialled an agreement about the use of bombs or war-heads under joint control … This regular agreement replaces the loose arrangements made by Attlee and confirmed by Churchill.
"This regular agreement", as Macmillan called it, referred to bases. Cmnd. 406 of 1958 is relevant here.
Is the Prime Minister relying on what Harold Macmillan called a loose arrangement or on Harold Macmillan's regular agreement? What does she see as the difference between the two, whichever one she may rely upon? The House has a right to be concerned if it is the loose arrangement that Harold Macmillan found inadequate, but if it is Mr. Macmillan's agreement, why has she not said so? The House has a right to know exactly what the present arrangements are, other than by reference to an apparently loose agreement that is more than 30 years old.
We all know that the American Congress and the American people are aware of their chain of command and communications system. If the American Congress and people know, why should not the House of Commons and the British people? Americans know that if the President cannot personally make a decision, it will be made by the Vice-President and, if not by him, by the Speaker of the House. If the Prime Minister for whatever reason, however good, was unable to make the decision—if decision indeed it is—what then? The House of Commons and the British public should know. We should know what "decision" means and who would take it.
In Germany, under the Athens guidelines of 1962, there is a form of joint control over the firing of certain Pershing IA missiles and what I would regard as a dual key


arrangement over other Pershing IA missiles. One involves a veto by the German Chancellor and one does not. Are we to take it that the Government would have an absolute veto in the case of cruise? My assumption is that they would not, because on 25 January 1983, when asked for a straight yes or no about a right of veto on a decision of the American President, the Prime Minister ducked the question and replied:
The position is exactly the same as it has been for the past 30 years."—[Official Report, 25 January 1983; Vol. 35, c. 789.]
If the Government have a good case in defence of the present arrangements, let them make it. I believe that they could easily do so without any security risks. In any case, I would guess that Moscow, like Washington, already knows more than the House of Commons.
I return to what I said about the reassurance of an explicit dual key, either as I defined it or as applied to Thor 20 years ago. It seems obvious that a dual key makes best sense. Why do we not have one? Did the Government forget about it in the negotiations leading up to the decision of December 1979? Have they been so confident since then as to believe that it did not matter in terms of public opinion? The Government may be entirely satisfied with present arrangements, but alternative reasons have been given for their failure to get a dual key.
One reason is that we should have to buy the missiles and man them ourselves at unacceptable cost. Another is that the Germans would not like it because the Russians would not want the Germans to have a finger on the nuclear trigger. It has even been suggested—although, to be fair, not by Ministers—that the American Administration would not want a dual key on American missiles in Britain. My own understanding is that if the Government asked the United States Administration for a dual key, they would still agree. As the Secretary of State has said, the dual key was on offer when the decision to deploy was taken in December 1979.
The United States Administration have always accepted and accept now that there should be different arrangements in different countries. In Britain, the launch of cruise could be on the basis of two separate affirmative decisions with the British Government in sole charge of one of the communications system. There could be British manning of the missile bases and joint crews. All this is open to the Government, unless the Minister of State says otherwise, if they ask.
Cost is not crucial. We would not be obliged to purchase the missiles. Again, if that is not so, I hope that the Minister of State will say so. The cost of the communications system could be managed. In any case, if the present arrangements are as good as the Government claim, the problem of communications must already have been solved.
In his letter to me of 31 December, the predecessor of the present Secretary of State referred to "the additional cost burden" of a dual key. If the new Secretary of State disagrees with what I have said, will the Minister of State spell out exactly what this additional cost burden would be, and say when Washington offered such terms?
As the Minister of State knows, I have a letter dated 25 January to the Secretary of State awaiting reply. Perhaps he will answer my questions tonight and then ask his right hon. Friend the Secretary of State to confirm them in his reply to my letter.
The Vice-President of the United States will be in London this week and some of us will be meeting him on Wednesday. I hope that the Prime Minister, the Secretary of State for Foreign and Commonwealth Affairs and the Secretary of State for Defence will say clearly that the most positive efforts must be made to get an agreement with the Soviet Union that will avoid the deployment of cruise missiles. I hope also that they will make it clear to the Vice-President that the United States will find real problems with its allies if it fails to negotiate flexibly and in good faith.
I hope that the Prime Minister will say that many of us who are firmly committed to the proper defence of Britain and to the membership of a nuclear-armed NATO are profoundly concerned about the present arrangements for joint control and the absence of a dual key. It is within her capacity to remedy this and it would be wise to tell the Vice-President that she intends to do so.

Mr. David Penhaligon: I wish to support the detailed speech of my right hon. Friend the Member for Stockton (Mr. Rodgers). I have had some interest in the arguments in favour of the dual key control of cruise for at least four years. I have raised the issue at various party conferences and at public discussions of the party's defence posture. In common with many others, I do not want cruise in Britain. However, I accept that there may be conditions that will make it necessary to have it. My analysis of those conditions would be searching and they would certainly have to go beyond those that presently apply.
There must be discussions with the Soviet Union with a view to mutual arms reductions. If the USSR has the peaceful intent that many believe it to have—I must put a question mark against that intent—then there are offers that it can accept. It can do so without a loss of face and this will give encouragement to those who are worried about the long-term.
It may be that what I consider to be a reasonable offer will eventually be made to the USSR and it will refuse it. I am prepared to say that in that event there are circumstances in which I would be prepared to use my vote in the House to support cruise. One condition is dual control. I cannot understand why this weapon system is about to be imported into our land without the Government having any physical control over it.
The current arrangements were explained by the Secretary of State for Defence at Question Time last week. It seems that if a maverick President of the United States were in office and the missiles were installed in Britain, he would have the capacity to fire them no matter what the British Government might do. That would be the physical position in the short-term. A decision of such significance and importance, should not be made without the Government having the means to say no. That is what we are looking for in the dual key arrangement. If the missiles are on British soil and may be fired from British soil, the Government should have that right.
We do not need to attend many meetings in our constituencies to discuss the general arms build up that is taking place to know just how worried people are. Their worries are manifold.
Some of the worries I feel that I could represent in the House. Some I could not—I am neither a pacifist nor a unilateralist. However, there are many fears that one can


comprehend, and feel. People realise that the firing of these weapons can only herald the end of civilisation as we know it. The idea that the odd cruise could be fired without retaliation is ludicrously optimistic.
During question time last week, and in one or two articles that I have read—although I have not studied the subject as well as my right hon. Friend the Member for Stockton—the only reason that has been given against dual key control is one of cost. I would be interested to know what those costs are. Perhaps the Government may need some votes to get the extra costs through. If they do, I might be prepared to join such a Lobby. If the Government can find £10,000 million to install the Trident missile system, I cannot believe that the extra cost of a dual key control of cruise does anything other than pale into insignificance.
If the reason is not one of cost, what is it? There seems to be some willingness on the part of the United States to have dual control—why then do the British Government refuse it? I assure the Minister, who might be wishing to persuade his hon. Frinds of a defence policy with which I might not completely concur, that if he could say to the British people that the missiles are to be installed in our country only when the British Prime Minister of the day has a physical "No" at his or her disposal, there would be a great deal more confidence among the British people.
It is an elementary question for the people to demand that, with a weapon system of this sophistication and destructive power the Prime Minister elected by the British people and installed in power for a Parliament, should have an absolute ability to deliver a physical "No" to the firing of cruise. The inquiries I have made reveal that the only constructive reason given against that aspect of the development of nuclear policy is that of cost. That is an extraordinary reason when one understands the size of our total defence budget.
If the Minister announced dual key tonight, he would do much to reassure many of his supporters. Doubts on this subject are not confined to the Opposition Benches. One can meet many Government supporters, as I do in my part of the country, who are worried about the dual key and the physical "No" aspect of the cruise missile system, even if they have confidence about other aspects of the nuclear policy.
I hope that the Minister will reveal what the cost is, and why the Government do not grasp this option. I hope he does not use the old excuse that we agreed something different in 1950. I was six years old in 1950. The world has changed since then. We want reasons as to why, in today's conditions and with today's knowledge, the Government are not prepared to insist upon a physical "No" before the cruise missiles are ever used from our soil, when and if they are installed.

The Minister of State for the Armed Forces (Mr. Peter Blaker): I repudiate at once the spurious complaint made by the right hon. Member for Stockton (Mr. Rodgers) that I am taking the debate, and not my right hon. Friend the Secretary of State. I do not recall, in 18 years in the House, a case where a Cabinet Minister has taken one of the debates on the Consolidated Fund when that Cabinet Minister has other Ministers in his Department.
None the less, I am grateful to the right hon. Gentleman for raising this subject. It is one that has caused some interest in the House and it is right that we should discuss

it in depth. In the course of the debate, I hope to allay some of the concern that has been expressed by explaining the background to the existing arrangements, which the Government believe to be satisfactory and which previous Governments, which have included the right hon. Member for Stockton serving as a Minister of State for Defence in a Labour Government, have likewise accepted.
From 1942 onwards, with a brief post-war break, there has been an American military presence in the United Kingdom. It was during the Berlin blockade by the Soviet Union in 1948 that American aircraft returned here. From that time all successive British Governments have welcomed the stationing of American forces at bases in this country. The deployment of American forces in the United Kingdom, as in other European countries, is a visible proof of the United States readiness to identify its national security with Britain's and Europe's security, and to defend it similarly.
That readiness is a crucial element of the NATO Alliance ability to deter aggression from wherever it may come. It is essential that any potential aggressor should be in no doubt whatever that the United States is fully committed to the defence of Western Europe, and that our defence is a collective one. Without the support of the United States since 1945, including the presence of American forces in Europe, Western Europe would not have survived in freedom. A fundamental principle of the Alliance is to share our defence in the common interest. An attack on one is regarded as an attack on all.
Since the foundation of NATO we have subscribed, with our allies, to the strategy of deterrence. We have sought to maintain forces of a character and on a scale that would deter a potential aggressor by showing that any possible gains were far outweighed by the risks he would incur. That does not necessarily require matching the Russians weapon for weapon, but it does mean having a flexible and significant armoury ourselves at both the conventional and the nuclear level.
NATO's intermediate range nuclear forces have consisted since the 1960s of British and American aircraft stationed in England and no other country—the British Vulcan and the American F111. The Vulcan aircraft are no longer operational. The remaining American aircraft will become increasingly vulnerable to new Soviet weapons and their bases, the location of which is no doubt known to the Soviet Union, are static. They will become less secure against an improving Soviet ability to attack targets far from their homeland. Our forces therefore need to be modernised. That is one of the reasons for the cruise missile decision.
On the other hand, the Soviet Union has over the past six years built up a potent force of SS20 missiles, each very accurate, each with three warheads able to hit separate targets, as well as retaining many of its older SS4 and SS5 missiles. It has about 1,000 warheads on intermediate range nuclear missiles aimed at Western Europe. NATO has no equivalent missiles.
Some Opposition Members—particularly Labour Members—claim that there is nevertheless in effect parity of intermediate range nuclear missiles between East and West. Let me quote to them the judgment of the International Institute for Strategic Studies in its latest statement on the military balance:
the balance is distinctly unfavourable to NATO and is becoming more so.


This enormous Soviet build-up, starting in 1977, and following the deployment since 1974 of the Soviet backfire bomber, was the reason why, after two years of careful study, the Alliance took in December 1979 what is known as the twin track decision. It resolved to introduce 464 cruise missiles in five different countries, and 108 Pershing II missiles in the Federal Republic of Germany. Each will have only one warhead. That was the first track. At the same time it offered to negotiate with the Soviet Union to make such a deployment unnecessary. That was the second track. The preparations for this decision started no later than 1977. It was the Europeans, not the Americans, who first pressed for a modernisation of intermediate range nuclear forces in Europe by the Americans to match, in part, the Russian build-up then already under way.

Mr. Sydney Chapman: I listened carefully to the remarks of the right hon. Member for Stockton (Mr. Rodgers) and the hon. Member for Truro (Mr. Penhaligon). The issue is of great concern to many people in this country. Will my right hon. Friend confirm that the number of Russian nuclear targets on Western Europe has increased by no less than 56 per cent. since 1977?
We all want peace, but peace can be guaranteed only by what Winston Churchill once said was the balance of terror. The cruise and Pershing II missiles are a direct response, not to America wanting them, but to West Germany initially and other NATO countries wanting them. If Mr. Andropov were to agree to President Reagan's zero option, whereby we could remove all the targets in east and west Europe, we could make the best possible cause for peace in Europe in our time by removing all these hideous weapons. Until then, the latest remarks by Mr. Andropov for a freeze of nuclear weapons will leave an imbalance, which again will cause insecurity in Europe. Therefore, we must concentrate our attention on multilateral disarmament, rather than unilateral disarmament of nuclear weapons.

Mr. Blaker: I entirely agree with what my hon. Friend says about the implications of Mr. Andropov's offer. Its effect would be to give the Soviet Union a monopoly of intermediate range land-based nuclear missiles. We would be debarred under that proposal—it has not yet been made formally—from having any of the missiles which we propose to deploy in the absence of a sensible, fair and balanced agreement with the Soviet Union, which is what we are seeking.
My hon. Friend rightly said that it was the Europeans who asked the Americans to deploy American weapons to help to redress—at least to some extent—the imbalance that was developing in Europe between the Russians and NATO in intermediate range nuclear missiles. The history of the affair is that the Europeans are requesting the Americans to bring their missiles here.
My hon. Friend asked how many missiles had been installed by the Soviet Union since 1977. It now has 333 of the very accurate and powerful SS20 missiles, each with three nuclear warheads, two thirds of them aimed at western Europe.
My hon. Friend mentioned the balance of terror. Some people say that that is the way peace has been kept in Europe since 1945, and that is true. The balance of terror

is much better than an imbalance of terror, and that was the direction in which we were heading until the decision by NATO in 1979, to which I have referred.
This enormous Soviet build-up following the deployment since 1974 of the Soviet backfire bomber, was the reason why, after two years of careful study, the Alliance in December 1979 took what is known as the twin track decision. I have already said how many of the missiles are to be deployed.
The right hon. Member for Stockton said that the account in yesterday's Sunday Times of the involvement of the Labour Government in the preparations for the decision taken in 1979 is substantially correct. That is my impression.
From 1977 until they lost office in May 1979, the Labour Government were fully involved in all the NATO studies and decisions. For example, in May 1978, the North Atlantic Council communiqué said that the NATO representatives
also noted with interest the work under way in the nuclear planning group towards meeting needs for the modernisation of theatre nuclear forces.
The word "theatre" refers to the European theatre and "theatre nuclear forces" are those now known as intermediate range nuclear forces, of which cruise missiles are part.
On 25 April 1979 the NATO nuclear planning group met in Florida. The United Kingdom was represented by the right hon. Member for Sheffield, Park (Mr. Mulley) then Secretary of State for Defence in the Labour Government. The following day The Guardian stated:
NATO's planners have apparently agreed on the need to modernise their nuclear armed aircraft and missiles with the range to strike into the Soviet Union from Western Europe. A decision in principle was taken yesterday by the Alliance's Nuclear Planning Group.
It was also reported by The Guardian that
the ministers have spent the past two days considering how best to match the SS20 and the Backfire with longer-range and equally deadly nuclear weapons within Europe alone. And, as the Russians must undoubtedly have expected, they have on their list a long-range version of the Pershing missile, then the Cruise missile and possibly a purpose-built weapon aimed from Western Europe at the Soviet Union.
The communiqué published at the end of the meeting is consistent with that account, although not so full. It is clear that from the beginning the Labour Government were deeply involved in all the preparations for the installation of intermediate range nuclear missiles in Europe to provide some element of deterrence against the Russian build-up. It is true that in April 1979, just before they lost office, no final decision on the choice of weapon was taken, but as the nuclear planning group communiqué makes clear, the decision of principle to modernise theatre nuclear forces was taken. So far as the first track was concerned—deployment of missiles in Europe—the right hon. Gentleman the then Secretary of State for Defence, awake or asleep, was in it up to his neck.
After the twin track decision was announced, the Opposition supported it. As he has said, in the debate on 24 January 1980 the right hon. Member for Stockton, then Labour shadow Secretary of State for Defence, speaking for the official Opposition, said of the decision:
we accepted the need to move ahead on the proposed timetable. It was the view of the previous Government that theatre nuclear modernisation was essential, and that is our view today."—[Official Report, 24 January 1980; Vol. 977, c. 691.]
Later in his speech, the right hon. Gentleman made it clear that he was speaking with the authority of the shadow


Cabinet as a whole. Four days later, in a debate on East-West relations, the right hon. Member for Stepney and Poplar (Mr. Shore), then the shadow Foreign Secretary, said:
NATO made its offer of arms limitation in the context of the decision on theatre nuclear weapons on 12 December and that offer was repeated in NATO's statement last Friday, on 25 January. I believe that that is right."—[Official Report, 28 January 1980; Vol. 977, c. 1074.]
The right hon. Gentleman made no criticism of the decision on theatre nuclear weapons. The terms on which they were to be accepted were stated by my right hon. Friend the Member for Cambridgeshire (Mr. Pym), then Secretary of State for Defence, in the debate on 24 January 1980 in which the right hon. Member for Stockton took part as follows:
There is a domestic aspect of the TNF programme on which the House will expect me to say something. Within the programme, which needs to be looked at as a whole, the Government have agreed to accept the deployment in the United Kingdom of 40 launch vehicles with 160 ground-launched cruise missiles. They are to be owned and operated by the United States within the long-established framework of the agreements between our countries; agreements which cover any use of United Kingdom bases in war, and which my right hon. Friend the Prime Minister recently confirmed to the House. We are now having detailed discussion with the United States about where the new systems might best be located and I shall make a statement about our conclusions on that in due course."—[Official Report, 24 January 1980; Vol. 977, c. 676.]
In the light of what I have said, I do not see how it was possible for the right hon. Member for Leeds, East (Mr. Healey) to say in the House on 15 December:
The matter was not discussed in NATO circles, and no decision was taken, until the end of 1979".—[Official Report,15 December 1982; Vol. 34, c. 314.]
I simply cannot square that with the facts. It is time that the right hon. Gentleman explained exactly what he meant by those remarks.
What were the arrangements to which my right hon. Friend the Member for Cambridgeshire referred? The use of the bases from which the American forces operate is governed by an agreement reached by Mr. Attlee and President Truman in 1951 and reaffirmed by Mr. Churchill and President Truman in a joint communiqué in 1952. The text of that communiqué was read to the House on Tuesday 1 February 1983 by my right hon. Friend the Secretary of State for Defence. I shall do so again because it is fundamental to allaying hon. Members' concern on this issue. It says:
Under arrangements made for the common defence, the United States has the use of certain bases in the United Kingdom. We reaffirm the understanding that the use of these bases in an emergency would be a matter for joint decision by Her Majesty's Government and the United States Government in the light of circumstances at the time.
That arrangement covers the use of bases for all United States forces in the United Kingdom, both conventional and nuclear, including the United States F111s which are already sited in Britain and the cruise missiles which are due to be deployed here from the end of 1983 in the absence of concrete results from the arms control negoiations in Geneva. As the text of the 1952 communiqué makes clear, a joint decision is required. I emphasise that this is not just a matter of consultation, nor one for the United States Government alone. It is a matter for joint decision making.
That that argreement has stood the test of time is, I believe, well illustrated by history. It is reviewed and has been reaffirmed every time a Prime Minister in Britain takes office ad every time a President in the United States

takes office. That has been done by successive British and American Administrations since 1951, including that in which the right hon. Member for Stockton served in the Ministry of Defence, and on each occasion Governments of both parties have accepted the arrangement. My right hon. Friend the Prime Minister has recently told the House that the Government are satisfied that the understanding remains effective.

Mr. Rodgers: The Minister referred to a joint decision on the use of bases. As this is an important matter, will he explain exactly what he understands by "the use of bases"? Does that explicitly involve the launch of missiles, and if so, does it also involve their arming, which, as he knows, in the case of cruise takes place at a later stage?

Mr. Blaker: I am sure that, as a former Minister in the Ministry of Defence, the right hon. Gentleman knows that no Government since 1952 have been prepared to go into detail about exactly how these arrangements are put into effect. However, I repeat that every new Administration who have taken office in Britain have looked into these matters and have expressed their satisfaction with them, including the Administration in which the right hon. Gentleman served.

Mr. Rodgers: As this is an important point, I should make it plain that, as I said, the arrangements for Thor missiles were much more explicit. In 1950–51 there may have been no demand for greater explicitness, as the Minister said, but there is a demand now. If it could be done for Thor, and given the fact that the knowledge of these arrangements exists elsewhere, why cannot the Government lift the veil of secrecy which may have been convenient for 30 years but which is not justified in the present circumstances?

Mr. Blaker: I shall deal with the Thor missile Later, but the brief answer is that we owned the Thor missiles and the United States owned the warheads. There is no precedent for a dual key. There was a dual key in the case of Thor—that is the difference. There is no precedent for a dual key except where the host government owned the missiles or other forms of delivery of the weapons.

Mr. Rodgers: With respect, the Minister cannot have it both ways. Either he argues that because this information is and should remain classified he cannot give it to the House or that the Prime Minister is not prepared to give it, which would apply to Thor, or, if it is possible to give the information about Thor because of the dual key, that is no reason why information should not be provided now about the precise arrangements governing cruise. I ask again, does the joint decision affect only the use of the bases, which is a flabby description, or does it affect the launch of missiles and their arming?

Mr. Blaker: The right hon. Gentleman knows that if he had been at the Dispatch Box he would not have been able to go further than I, except that in the case of Thor it is not true that we can explain all the details. I will say more about Thor and other dual key systems in a moment. I certainly would not dream of explaining how the system works.

Mr. John Roper: The hon. Gentleman said that no one has gone further in the House. He must know what Mr. Harold Macmillan said:
United States aircraft carrying nuclear weapons also carry the apparatus for arming them. I have the assurance of the United


States Government that the pilots have specific instructions not to arm weapons until they are directly ordered to do so in order to carry out an operation of war, and that in that event the arming would not take place until the latest moment necessary for the execution of the operation. I must repeat that such an order could be given only after agreement between the two Governments".—[Official Report, 12 December 1957; Vol. 579, c. 1421.]
Mr. Harold Macmillan was able to go further in 1957, so why can the Minister not do so?

Mr. Blaker: That is an example of a joint decision.
The right hon. Member for Stockton drew attention to the arguments in favour of a dual key system of control for cruise missiles. I am now coming to how Thor and other dual key systems have operated. As the right hon. Gentleman knows, there are dual key systems in Germany at the moment. There are a number of ways in which they can operate. In essence they all depend on the fact that one country owns, mans and operates the means of delivery—whether it is a missile, an aircraft or an artillery piece—while the second country owns and controls the nuclear warhead. This arrangement has been described as "dual key", although physical locking mechanisms are not necessarily involved.
This is the arrangement under which the United Kingdom-owned Lance missiles and nuclear-capable artillery in BAOR operate with US warheads, and many of our NATO allies also operate similar dual key systems. The Thor missiles, which I have already explained, were an example of a system of this kind. Those missiles were owned by the United Kingdom and operated by the RAF, although the warheads remained under United States ownership and control.
The United States Government made it clear to the United Kingdom and to the other European countries that are accepting basing of the Pershing II and cruise missiles that they were prepared to make the missiles available on a dual key basis. There is no point of principle here. As my right hon. Friend the Secretary of State made clear recently, the option of having a dual key was open to the United Kingdom if we had purchased the missile and supporting equipment and provided British service men to man them, with the United States providing only the nuclear warheads. This would have cost hundreds of millions of pounds and required well over 1,000 additional British service men.
I emphasise again that the Government were, as they are now, fully satisfied with the effectiveness of the existing arrangements under the terms of the 1952 communiqúe, that has stood the test of time over a significant period under Governments of both parties.

Mr. Rodgers: The hon. Gentleman said "now". It is a question of principle whether cruise missiles should be dual key. He said that at the time of the decision in December 1979 the United States Government made it clear that to have a dual key system we would have to purchase the missile. Can he say, categorically, that that is still the view of the United States Government, and that they are now saying that we would have to purchase the missile in order to have a dual key?

Mr. Blaker: We have not discussed this matter with the United States Government. We have no reason to

expect that their position would be any different. The reason why we have not discussed it with them is that we are satisfied with the present arrangements.
Against the background of the cost that would have to be incurred if we were to purchase the missiles, we came to the conclusion that there was no requirement to incur the additional strain on the defence budget that that would have involved.
There will, however, be an element of British responsibility for the cruise missile force of which hon. Members may not be sufficiently aware. I say this because the right hon. Member for Deptford (Mr. Silkin) asked a question last Tuesday which implied that he was not aware of it. He asked what would be the position when the cruise missile, which, of course, will be mobile, travels by road. The answer is that the missiles, whether on their bases or outside them, will be guarded by a joint and integrated security force, a substantial proportion of which will consist of members of the RAF. Indeed, the bases at Greenham Common and at Molesworth are and will remain RAF bases, with a substantial RAF presence, commanded by a senior RAF officer.
Disarmament is the second of the twin tracks. NATO would prefer that it should not have to introduce cruise or Pershing II at all. That is why the United States, with full support from NATO, has put forward the zero option. This would involve the Soviet Union dismantling its intermediate range nuclear missiles targeted against Western Europe in exchange for NATO abandoning its plans to introduce cruise and Pershing II. It would mean the Soviet Union dismantling missiles which already exist, but this is simply a reflection of the superiority that it possesses.
It is a radical proposal for real disarmament—as opposed to the proposals of the one-sided disarmers who seem unconcerned at the formidable capability of the Soviet arsenal and unwilling to seek to reduce it. I cannot see why anyone in the West should prefer a situation in which there should be no cruise missiles, no Pershing IIs but some SS20s.
One thing that is not sufficiently recognised is that the introduction of cruise and Pershing II missiles into western Europe will not increase the number of nuclear warheads in Europe. For every warhead introduced, one will be removed. Moreover, when the twin track decision was announced, the United States promised to withdraw 1,000 nuclear warheads from Europe. This it has done, regrettably without any reciprocal action by the Soviet Union. Our policy will not, therefore, increase the number of nuclear weapons in Europe—quite the contrary.
The zero option must surely be the best solution, involving as it does the abolition of an entire category of nuclear weapon. We recognise that this may not in the final analysis be possible and are ready to consider seriously any fair and sensible proposals from the Soviet Union for achieving a balanced reduction of forces. But Soviet proposals must be fair and sensible. We remain deeply sceptical of packages designed for propaganda purposes rather than for serious discussion.
The onus is on the Opposition to explain why they have now decided to reject the policies in which they have believed for 37 years—policies which in that time have successfully kept the peace in Europe. They should explain why, having supported NATO's decision of 1979 to deploy cruise missiles in this country but at the same time to negotiate with the Russians for an agreement which


would make such deployment unnecessary, they have now changed course by 180 degrees and resolved to reject NATO's policy.
The Government believe that if we were to waiver in our resolve to carry through the NATO decision, still more so if we were to reject it, the pressure on the Soviet Union to agree to reductions in its own forces would be lifted and the prospects of arms limitation by both sides would be seriously damaged. As Aneurin Bevan would have put it, we would be going naked into the conference chamber.
It is only the West's resolute approach—preserving peace by maintaining adequate defence forces—which includes modernising them when necessary, coupled with consistent support for disarmament by both sides, which offers any prospect of ensuring our security and persuading the Soviet Union to engage in meaningful negotiations on arms control. It has brought the Russians to the negotiating table. It has persuaded them to offer some concessions, even if they seem at present not to go far enough. It has begun to work. If we pursue it, it can go on working.

Mr. John Roper: We are grateful for the Minister's comments, but, as I said in an earlier intervention, he has been a good deal less forthcoming than others have been in the past on this important subject. It is not a new subject, and a great deal of general discussion on the need for the dual track decision of December 1979 took place on previous occasions. The purpose of today's debate is to probe as far as we can and as far as occurred on previous occasions the nature of the control of nuclear weapons based in this country. Despite the Minister's remarks today and the Secretary of State's answers last week, one of which the Minister has quoted, the position is not clear.
The House is still somewhat confused about the significance of the Secretary of State's reply on 1 February when his hon. Friend the Member for Plymouth, Sutton (Mr. Clark) pressed for the introduction of a dual key. The Secretary of State said:
It might help my hon. Friend to understand that the arrangements governing the use of the bases would come into effect much sooner than the decisions to use weapons in the context in which my hon. Friend describes the rather delicate electronic machinery for firing the weapons.
The decisions to use the bases would be at a much earlier and therefore much more important stage of the process in that context."—[Official Report, 1 February 1983; Vol. 36, c. 134.]
Presumably, the decision for the Americans to use the bases has already been taken. Is that what the Secretary of State meant? That is clearly an important decision and it has been taken at a much earlier stage than the decision to use the weapons. It was certainly a curious reply to say that the decision to use the bases was a much more important and a much earlier decision than the decision to use the weapons and it contrasts with the comments of Mr. Harold Macmillan, one of which I have already quoted.
In the winter of 1957–58 there was also some confusion following the extraordinary remarks of Colonel Zinc, an eagle colonel of the United States air force, who on 27 February 1958 claimed that he was about to take over operational command of the rockets and rocket bases in England. Mr. Macmillan noted in his diary:
As this is in direct contradiction to

(a) the terms of the agreement published last Monday,
(b) what we told Parliament on Monday and in the debate yesterday,

Colonel Zinc has put his foot in it on the grand scale!

It is all very well for the Colonel Zincs of this world to put their foot in it on a grand scale, but many people are worried lest they put their finger on the button on a grand scale.
That ambiguity in regard to an American colonel in operational command may have been acceptable at that time because, in contrast with the Minister today and the Secretary of State last week, Mr. Macmillan had been a great deal more explicit. I have already given a quotation from Hansard of 12 December 1957. In a broadcast reported in The Times of 6 January 1958, Mr. Macmillan had gone further. Referring to bombing from aircraft based in the United Kingdom, Mr. Macmillan said:
None of these bombs could be, or would be, used except by deliberate military order, given under the instruction of the British and American Governments acting in agreement. We ourselves have an absolute veto on the dropping of these bombs from any plane based in this country.

Mr. Chapman: The hon. Gentleman, as much as any hon. Member, desperately wishes for peace with security. Whatever a former Prime Minister may have said 25 years ago, is it not true that during the past five years the Russians have increased the nuclear warheads targeted on Western Europe by 56 per cent? As my hon. Friend the Minister said, the West has reduced the number of nuclear warheads by 1,000. The simple proposition is that if the Russians agree to dismantle their SS20s—never mind the SS5s and SS4s, although they are important—NATO will not introduce the cruise missile and the Pershing II. If Russia, in good faith, is interested in reducing tension and removing the threat of nuclear warfare in Europe, all it has to do is reduce the weapons and we will not introduce cruise and Pershing II. That is the best step forward for peace in Europe in our time.

Mr. Roper: The hon. Gentleman is right. If an agreement can be reached at Geneva it will not be necessary to deploy the weapons. We devoutly hope that that will be the case. However, it is clear that a large number of our fellow citizens are concerned, as was Harold Macmillan in 1957 and 1958, about the control of the weapons if an agreement is not reached. At the end of the year we are bound to deploy the weapons under a decision taken in 1979.
Neither the Minister nor the Secretary of State has aswered the point made by Harold Macmillan, who said in 1958:
We ourselves have an absolute veto on the dropping of these bombs from any plane based in this country. There is no doubt about this whatever … And we will have exactly the same veto upon the use of rockets as we have on the use of bombs from aeroplanes.
That was his clear statement. It is a much clearer statement than we heard last week from the Secretary of State for Defence or from the Minister today, who said that he had gone as far as possible for reasons of security. If it was possible for that degree of clarification and reassurance to be given to the House and the country by Harold Macmillan in 1957 and 1958, why is it not possible for it to be given by the Secretary of State and the Minister today? That question has puzzled my right hon. Friend the Member for Stockton (Mr. Rodgers), and it certainly puzzles me.
The Minister mentioned one possibility that was considered and discussed by the NATO allies in the high level group in 1978–79, when the arrangements for the deployment of the intermediate nuclear forces were made.


The Minister said today, as has been said before, that the option was then available for the host countries to have a dual key system. He suggested that it was probable that the United States would have required the host countries to cover the costs of acquiring the missiles, which would probably have run into hundreds of millions of pounds. I hope that I do not misrepresent him.

Mr. Blaker: Not probably—certainly.

Mr. Roper: I am grateful for that clarification. Two questions arise from that. Were the Lance missiles—which are based in West Germany and operated by the British Army of the Rhine, and which have American nuclear warheads but are controlled under a dual key arrangement by British and American officers—bought by the British armed forces before the dual key came into operation?

Mr. Blaker: We have bought them.

Mr. Roper: I am grateful for that reply. The Minister said that in 1978–79 the United States required host countries to purchase their cruise missiles outright. He quoted a figure of hundreds of millions of pounds. The figures are diminutive compared with the billions of pounds that the Government are contemplating for the Trident missile system.
It would be interesting to know whether we are in the lower range of hundreds of millions of pounds or in the higher range. Whichever it is, the Minister had to admit under pressure from my right hon. Friend the Member for Stockport that the Government have not returned to the subject in their discussions with the United States since 1979. That is odd when a large proportion of the British public, Conservative Members and other hon. Members, believe that a solution by which there was a dual key would give such reassurance to the British people and reduce some of the opposition to the installation of cruise missiles.
It does not seem necessary that the United States should require payment in full for cruise missiles. They may need no payment at all. The Minister is unable to tell us, because the Government have not had recent discussions with the United States. That is rather surprising. All that is required is an additional communications line between where the Prime Minister or the British political authority is and the base. That would not represent a significant additional cost.
The Minister has given a disappointing response. We ought to know whether that option is now on offer, how much it will cost and if, as I suspect may be the case, it will not cost much, whether the Government will consider introducing a dual key system. If we need to deploy the missiles by the end of the year, the vast majority of our fellow citizens would prefer it if they were deployed under a dual key system.

Dr. Oonagh McDonald: The implication of some of what the Minister has said was just what we have come to expect of the party that he represents. It was the usual claim that Labour is somehow determined to leave the country defenceless and that, by rejecting the deployment of cruise missiles here, Labour will ensure that the country is represented naked at the conference table.
We are used to such complaints from the Tory party. They are being intensified. The chairman of the Conservative party is travelling around the country. He has been told to blame the Labour party for world war two. Apparently the Labour party made the country weak, unarmed and unable to cope with Germany.
It is good to choose someone who regards himself as young and dynamic but who was only four in 1935 when the Tory party won the general election with a majority of 247. Yet with that majority, and the power and ability to re-arm the country and face the threat that Germany posed, the Tories claimed that they could do nothing and that the very existence of the Labour party ensured that the country was unprepared for the war. All the while, they followed a policy of appeasement.
Precisely the same sort of complaint is being made now that, although we are in Opposition, our opposition to the possession of a so-called independent nuclear weapon and to the deployment of cruise missiles here is somehow weakening this country in relation to Russia. That is in no way part of our intention or plans. In its opposition to nuclear weapons, particularly to the possession of an independent nuclear weapon, our party is trying to clear the way to building up strong conventional forces. Just as this party neglected the nation's defences in the 1930s, so the Tory Government are now neglecting the nation's defences in the 1980s. Shortly after the Tories leave office the number of ships in the Navy will have fallen to about 40 and the Air Force will not have been properly built up—

Mr. Blaker: What possible justification has the hon. Lady for giving that figure of 40 ships? Where did she get it from because it is totally untrue?

Dr. McDonald: From the British Maritime League, in its analysis of the number of ships, their age, and the refits that have been carried out. That is one among many reasonable and respectable sources on which to rely for such a figure.
It was said about the sending of the fleet to the Falkland Islands that a year later that could not have taken place. Once again the Tories will leave the country weak. Its conventional forces will be weak. When we return to office we shall have to devote some of our energies to building up the conventional forces, for we believe that those conventional forces provide us with our real strength and that they are the best contribution that we can make to NATO's defences. That is why we put our emphasis there. When we take office, by abandoning the Trident missile project, we shall be able to put our money where our mouth is.
Expenditure on cruise missiles is not in any way such as to prevent the proper build-up of conventional arms. Our opposition to them has a different basis. We believe that the deployment of cruise missiles here will render this country not stronger in relation to Russia but more vulnerable. The argument is extraordinary that we should accept cruise missiles to aid us to negotiate their disappearance. More extraordinary is the argument and the quotation from Aneurin Bevan that we should not enter the conference chamber naked but rather with our nuclear weapons, either American or British-owned, in tow.
The fact is that we are not in the conference chamber. The present talks in Geneva are between America and Russia. We are not included. From time to time, when she


remembers the need to refer to peace, the Prime Minister echoes but faintly what President Reagan has to say. We want to see the disarmament talks succeed. It is surprising that once again the Minister referred only to the zero option. Other proposals have been put on the table by Russia. I am not saying that those proposals should necessarily be accepted at face value, but I am saying that the Government should not be too inflexible in their support for America in the progress of disarmament talks. After all, some of the signs from America are that other possibilities could be considered at Geneva. The Prime Minister should not only echo that but she should be using all her energies in a push forward for peace and for the progress of the disarmament talks at Geneva. We hear little enough from her on that topic.

Mr. Blaker: The hon. Lady is inaccurate again.

Dr. McDonald: The Minister likes to take silence as support for his arguments because he has little else with which to support them.
I return to the question posed by the right hon. Member for Stockton (Mr. Rodgers) about the dual key system for the cruise missiles based in this country. He has expressed it as a matter of grave anxiety and has been supported by his hon. Friend the Member for Farnworth (Mr. Roper), and his party has taken up the issue. I am surprised by the right hon. Gentleman's anxiety. In a pamphlet entitled "Defence, Disarmament and Peace" which was published in July 1980—a long time ago in politics, perhaps, for the right hon. Gentleman—in a paragraph headed "No new principle" he states:
As for a change in policy, there is certainly nothing new about nuclear weapons assigned to NATO being located in the United Kingdom … The United States has operated with nuclear weapons from bases in the United Kingdom since the early 1950s".
He then lists some of them. He continues:
In each case, the weapons have been controlled by the Americans subject to agreement on their use. There have also been facilities for American submarines armed with nuclear missiles at Holy Loch in Scotland, There has been no secret about these arrangements and they have been openly debated from time to time.
The right hon. Gentleman then continues with a series of questions and answers. He poses the question:
Couldn't some mad general press the button and launch the missiles at the wrong time or by mistake?
He answers his own question by saying:
Very elaborate procedures exist for consultation within NATO about the use of nuclear weapons. Here again, precisely

the same safeguards will apply to cruise missiles as to manned aircraft. A joint decision between HMG and the United States will be required.
In July 1980 the answer was straightforward and simple. There were no problems or anxieties.

Mr. Rodgers: The hon. Lady is reading from my pamphlet, from which I have also read. There is nothing in the pamphlet from which I wish to dissent now. What I said about elaborate procedures to avoid a mad general pressing the button is as true now as it was then, and I am satisfied with the arrangements. The hon. Lady will know, and if she does not I must remind her, that on 13 December 1979 I raised the subject of the dual key from the Bench on which she is now sitting. I raised it on a number of occasions in the following year, in particular on 2 December 1980. I was far more persistent in seeking a dual key than anyone sitting behind me.

Dr. McDonald: I have read this pamphlet through carefully and I detect no sign of such anxiety or reference to a dual key system. I believe that the anxieties have arisen for a different reason. It is because the Social Democratic party leadership has had to disappoint so many of its new members who are opposed to nuclear weapons here. In order to divert attention from the discrepancy between its members' views and those of the leadership it has brought up the dual key issue. It is a popular issue but not as popular as opposition to cruise missiles. Perhaps it would be sufficient to divert attention from the fact that the SDP is not opposed to cruise missiles.
We also heard a Liberal voice this evening, but that, too, was raised to divert attention in the same way. The leader of the Liberal party is also disappointing his membership by going back on the Liberal party assembly decision to oppose cruise missiles. The leader of the Liberal party wishes instead to concentrate on the best way of getting rid of cruise missiles, which is to push forward the disarmament talks in Geneva. He is not prepared to lead his party into an election on the grounds of opposition to cruise missiles. That choice for the electorate during an election campaign will be presented solely by the Labour party, which is the only party that is clearly and unequivocally committed to the removal of cruise missiles and is opposed to their deployment in Britain should they be installed here.
The Liberal party and the SDP are raising an issue—not unimportant—that is intended entirely to divert attention from the fact that they, too, support cruise and that their policies on defence are no different from those of the party in Government.

Orders of the Day — Scotland (Expenditure Plans)

Mr. William Hamilton: This debate gives the House an opportunity to examine what the Government have in store for Scotland during the next three years up to 1985–86. All the expenditure figures are given in the White Paper in cash terms, and no account is taken of inflation, although table 1.14 on page 17 of volume 1 of the White Paper gives the expenditure figures in cash terms, using 1981–82 as the base year. I shall put the figures on record to show what we are complaining about tonight. Whereas in 1980–81—the year before the base year—the total public expenditure in Scotland was £5,893 million, in 1983–84 that figure has fallen to £5,656 million. That is a reduction of £237 million, or more than £40 per head of the Scottish population. It represents a substantial cut in expenditure on housing, education, health and the services that do so much to improve the quality of life of many Scottish people.
The cuts could be much more devastating than the bare figures show, because they are based on the assumption that the rise in prices each year will stay at about 5 per cent. However, not many experts are so optimistic. The Sunday Times stated yesterday:
The White Paper's assumptions on inflation are, bluntly, incredible.
The article continued
Five per cent. inflation … is a Government fantasy".
and suggested that 8 per cent. inflation is more likely. The article gave pensions as an example. It said:
The pensions increase for next November to be announced in the Budget is to be based on an assumed 5 per cent. inflation rate in the year November 1982–83. Pensions, however, will not go up by the full 5 per cent., the White Paper makes clear; a deduction is to be made for the fact that pensioners got two per cent. more than needed to compensate for inflation in the last uprating … If 5 per cent. for prices is incredible, so, too, is the 3½ per cent. which is all the Government allows for public sector pay.
The article goes on to say that every 1 per cent. above the 3½ per cent. received by public sector workers would cost the Exchequer about £350 million a year.
In theory, of course, according to the Government, if the workers received more than 3½ per cent. in increased pay, the difference could come from programmes, but The Sunday Times article pours doubt on that proposition. Can anyone imagine the chiefs of the defence staff saying that, if pay increases by more than 3½ per cent., we will cut the purchase of guns or battleships. That would not happen. But, in paragraph 14, on page 79 of the White Paper relating to Scottish education, the Government say that, while a real cut in education is projected:
The number of teachers that can be afforded within these plans will depend crucially upon the level of pay settlements for teachers.
In other words, the Government are saying that, if the teachers receive more than 3½ per cent., there will be fewer of them and therefore, presumably, poorer education for the children. Even taking account of inflation, there will not be an improvement in the education service at any level over the three years with which we are concerned.
In terms of job opportunities for the young, the old, the middle aged and women, Scotland is rapidly becoming an industrial desert. A "scorched earth" policy could hardly have created as much devastation as the Government's policies in the past three and a half years. Yet, as the dole queues lengthen day by day and month by month, the

Government do little or nothing except to cook the figures and pretend that unemployment is good for the soul, and that it is not as bad as it used to be since the Secretary of State for Employment got his fingers on the statistics.
Table 2.4 of volume two shows that regional development grants are to be cut from £600 million in 1982–83 to £474 million in 1983–84. That help has gone and does go mostly to manufacturing industry in badly hit regions such as Scotland. Is Scotland being protected from that massive cut, because it is happening at a time when manufacturing industry is suffering its deepest recession for 50 years? How will the Scottish economy be protected from that onslaught? How many more jobs will be threatened under the present policies?
One can hardly pick up a daily newspaper without finding evidence of the increased number of redundancies all over the country. About 800 jobs are threatened at British Aluminium in Falkirk, and 1,900 jobs are threatened at Timex in Dundee.
The steel industry at Ravenscraig is by no means out of the wood and the workers are desperately worried. If the threatened takeover of Andersons of Strathclyde by Charter Consolidated goes ahead at the Government's instigation, how many jobs will be threatened? At John Haig's at Markinch in my constituency there is cold-blooded murder of 340 jobs. Markinch will be dead as a community if John Haig's closes. When I talked to the management last week there was no sentiment. It seems that the workers are regarded as pawns on the chess board to be moved or swept out of the way. The company is owned by distillers and is a profitable and wealthy organisation but the redundancy terms are appalling. I talked to a man who has been working for the company for 27 years. He has given loyal service. He will get £4,500 in redundancy pay, less than one year's pay. It will be gone almost overnight after 27 years. He is only in his early 40s, but he will not work again. There is no other work available for him in the area.
Another 200 jobs are threatened at Balfours at Leven. That is in an area where male unemployment in November 1982 was over 28 per cent. Despite repeated representations by the local authorities and Members of Parliament, the Government have refused repeatedly to return special development area status to the Levenmouth area.
The latest unemployment figures in Fife and throughout Scotland show the devastation of unemployment. The White Paper gives no crumb of comfort for those who are on the dole. There is an assumption of another 280,000 for the breadline in the United Kingdom next year. That will mean about 50,000 in Scotland. In October 1982—the latest figures available—127,837 had been out of work for over 12 months. I suppose that the figure is now about 150,000. When these figures were mentioned in the House last week the Secretary of State for Employment bleated "There is no easy solution. There is no easy, painless, short-term solution to this." We remember the fraudulent Tory poster at the 1979 election that was produced by Saatchi and Saatchi. It implied that if the electorate got rid of the "wicked Labour Government" the unemployment problem could be solved almost overnight. It was claimed that it was all the fault of the Labour Government.
The Prime Minister is constantly referring to the great achievement of her Government. She reminds us that the Government have brought inflation down to 5 per cent. I do not know what it is in the Sahara desert, but it will be


less than 5 per cent. We can always get inflation down as long as we are prepared to pay the price. The price is 3 million to 4 million on the dole with more to come. There is no sense in boasting about the rate of inflation if we have a ruddy desert on our doorstep, and that is what we are getting throughout the United Kingdom.
On her last visit to Scotland the Prime Minister appeared bejewelled, glittering, peroxided, powdered and painted and said "You have got to take it. Take your medicine, it is doing you good." The right hon. Lady is not suffering and nor is anyone on the Government Benches, but our people are. She said that the people should return to the Victorian virtue of hard work and thrift. By God, those on the dole would be happy if they could return to the prospect of hard work and thrift. They cannot work and they cannot exercise thrift. They have been denied both by the Government.
We were told last week that over 14,000 building trade workers are out of work. Yet over the past three years, we have seen the worst record of house building in 50 years. In 1980, only 2,800 council houses were started—the lowest peacetime figure since the 1920s. As we have had less money provided by the Government than ever, that downward spiral will continue. In the whole of 1981, and through the first nine months of 1982, according to the Under-Secretary, only 17,300 houses were completed in the public sector. In the same period, 28,500 houses were sold, with a net loss in the public rented sector of about 11,000 houses.
The Shelter survey in the winter of 1981 showed that more than 157,000 were on council house waiting lists in Scotland. There is an enormous pent-up demand for public house building, for the old, the single, those on low incomes and the newly married. Yet, the Government have not the wit to marry the 14,000 unemployed building trade workers with that enormous demand for houses. It is common sense, morally, politically and in every other way.
The figures in the White Paper show that, far from the Government doing that, public expenditure on housing is to be slashed in real terms by 20 per cent. in the next three years. That amounts to criminal irresponsibility, and a gross dereliction of duty on the part of the Government.
The sad story is told in table 2.15.3 on page 78 of the second volume of the White Paper. It shows that 5,100 houses were completed in 1982, but in 1976, under the previous Labour Government, 22,823 were built. In that same period, while the number of houses has gone down by 75 per cent., average rents have gone up by more than 150 per cent. Another period of Tory Government and all building of council houses will cease and all public money towards the building of those houses will have ceased.
Another aspect of this depressing White Paper is that of education. I speak as an ex-teacher, and I hope that everybody accepts the view that the long-term future prosperity of the Scottish economy depends more than anything else on investment in education at all levels. However, the Government are planning for a worsening of the pupil-teacher ratio, from 17:1 in 1982–83 to 17:6 in 1983–84 and 17:5 over the next two years.
It is true that the overall expansion in education expenditure is planned to rise by 9 per cent. from 1982–83 to 1985–86, but that is 9 per cent. over three years. That is 3 per cent. each year, which is a substantial cut in real terms. We have seen the examples of threats to teachers on the Clyde. In Lothian, several hundred teachers are

threatened with being sacked in the foreseeable future. Coupled with that, there will be severe restraints on teachers' salaries.
The capital expenditure programme on the Health Service will increase from £104 million to £132 in the three years of the survey period, which is an increase of 27 per cent., or 9 per cent. a year. That might well match inflation for the period, but there is hardly any scope for improvement in the service. It also implies a pay freeze of about 3·5 to 4 per cent. That applies to the nurses who were so scandalously treated in the last pay round. In addition, ancillary workers will be expected to take not more than 3·5 to 4 per cent. Meanwhile, inflation will increase to about 8 or 9 per cent. In other words, there will be a further reduction in the living standards of all those workers.
There will be no significant improvement in the health service despite the fact that the number of elderly people is increasing and that more resources are therefore needed. There are also greater demands on the local community services provided by local authorities, which are hard hit by the Government. The prospect is grim for almost every section of our community. Scottish Members of Parliament will have received today—and if not, they will receive tomorrow—a letter from Age Concern in Scotland which refers to the fear of the clawback that the Chancellor of the Exchequer is likely to announce in his Budget statement. It continues:
Over half our retired people are living either in poverty or on the margins of poverty.
The letter also refers to the poverty brought about by the fact that this winter fuel costs are beyond the means of many of our old people. But the elderly are not the only ones to be involved in the struggle against poverty. By 1985—if the Government last until then—the number of those living on supplementary benefit and on the poverty line in the United Kingdom will have reached a record of more than 4 million. A large proportion of them are old-age pensioners.
I have concentrated on a few of the services that are likely to be axed. There is no doubt that the figure that I gave earlier shows a substantial overall decrease, which means a reduction in the standard of living. However, there has been an enormous increase in defence expenditure. The Government can find plenty of money to spend on guns, bombs, aeroplanes, ships and soldiers. Spending has increased from £12,072 million in the last year of Labour government to £14,163 million in 1983–84. That is an increase of more than £2,000 million in defence spending in four years. It means that for every man, woman and child in Britain, we shall spend £250 a year. That is £5 per week for every man, woman and child.
As I have said, on the Government figures that have been published so far, the Falklands exercise will cost us more than £2,500 million, or about £2 million per head for every Falkland Islander. For Scotland, with a population of about 5 million, the proportionate figure would be £10 billion. The Government are spending all that money on the Falkland Islands and the whole story has not yet been told.
We are also spending a lot more money on the police and law and order. While the Government squeeze expenditure on housing, education, health and the services on which our standard of living depends, they are upping sevices for the police, the soldier, defence and the prison service. The figure that I have for the prison service shows


a substantial increase. So if a person wants to get a house in Scotland he should go into the prison service. That is the best way to get one. If he wants a good wage, he should join the Army or the police force, because that is where the money is going. Those are the Government's priorities.
My conclusion is a simple one. The Scottish economy is sick, although not dying. Among all sections of the community there is a feeling of despair and anger, a feeling that nothing is being done to help those who are most in need. Far from being optimistic, people feel that the situation will get worse. The Government believe that, too. That is why there is pressure on the Prime Minister to cut her losses and go to the country quickly in June before she is found out, and the pressure is coming from Tory Members.
The projections in the White Paper show that there is little or no sign that the Government intend to do anything to improve a situation which makes us all very despondent. Unless the Government change their policies, or unless there is a change of Government, that despondency will continue, and I shudder to think what the ultimate prospects may be.

Mr. Harry Ewing: I congratulate my hon. Friend the Member for Fife, Central (Mr. Hamilton) on raising this important matter against the background of the public expenditure plans for Scotland.
I start by taking up my hon. Friend's final point about the increase in expenditure on the police and prison services, compared with the decreased expenditure on the other services that he mentioned. I am sure that my hon. Friend will agree that there is a connection, in that the reduced expenditure is causing unemployment and problems in the Health Service, education and housing. As a result of a reduction in expenditure on those items, the Government are having to increase expenditure on the police and prisons. There is no doubt that the social pressures on people in Scotland as a result of the Government's economic policy are leading to a substantial increase in crime. The Government came to power saying that they would end unemployment and reduce crime, but what has happened? Unemployment has soared dramatically, and so has crime. Unemployment and crime both came down during the last year of the Labour Government. Unemployment fell for seven or eight consecutive months, and in the last two years of the Labour Government crime, too, was reduced. Under the Conservative Administration both have gone up.
My hon. Friend dealt with the industrial scene. He spoke of the reduction in expenditure between now and the financial year 1984–85 on regional and industrial assistance, which goes primarily to manufacturing industry. The Minister should tell us how much truth there is in the story in the Sunday Standard and other reputable papers that discussions are taking place inside the Government with a view to restructuring the various development areas, the special development areas, and the intermediate areas, and that the Secretary of State for Scotland is prepared, yet again, to accept more than his share of the Governments's reduced expenditure on regional aid.
The last time this exercise was entered upon, the reduction in regional aid amounted to £250 million for the United Kingdom as a whole. The Minister, who has drawn the short straw and has to remain here until 2 am to reply to the debate, will recall that he was a Back Bencher at the time. He will also realise that had he still been a Back Bencher he would now be in his bed. These jobs have their rewards and their punishments. The hon. Gentleman is now suffering the punishment. I have experienced it myself. I am not, of course, sympathising with the hon. Gentleman, who deserves everything that he is getting.
Of the £250 million reduction in regional aid to which I referred, the Secretary of State for Scotland gave up £45 million, or about 20 per cent., of the total. If there had to be reductions at all, the Secretary of State should not have been prepared to surrender more than 10 per cent. The story that I read in the Sunday Standard had opposite it pictures of the Minister of State, Department of Industry, and of the Under-Secretary of State for Scotland, the hon. Member for Edinburgh, North (Mr. Fletcher), whom I have to face in the British Shipbuilders Bill Committee at 10.30 am—the gruesome twosome, as I have been describing them recently.
How much truth is there in the story that discussions are taking place? I warn the hon. Gentleman that if any attempt is made to reduce the status of many of the development areas in Scotland, in the interests of other parts of the United Kingdom, it will be strongly resisted by my right hon. Friend the Member for Glasgow, Craigton (Mr. Millan), by my hon. Friend the Member for Glasgow, Garscadden (Mr. Dewar), who is present for this debate, and by all my hon. Friends on the Opposition Benches. Scottish industry, as the Minister will know from his previous incarnation with the CBI in Scotland, is in such desperate straits that, far from suffering a reduction in regional aid, we badly need an increase. All the assisted areas require upgrading if the problems that beset Scottish industry are to be dealt with.
My hon. Friend the Member for Fife, Central referred to the problems at Markinch following the announcement of the closure of John Haig's, a company of over 100 years' standing. There are problems associated with the possible closure of Henry Balfour and Son at Leven, my home town, and with the closure of the Carron company in Falkirk, a company of 260 years' standing. The first furnace was blown at the Carron Company in the year that Rabbie Burns was born. The furnaces were blown out last year by the Prime Minister.
That is the story throughout Scottish industry. It may be argued that these industries are old, but the new industries on which the Scotland of the future was to be rebuilt—the car plant at Linwood, the pulp mill at Fort William and the smelter at Invergordon—are also going. It is an additional warning to the Scottish Office not to contemplate giving up any resources.
I do not wish to forecast what will happen later this morning at Falkirk in my constituency. The Minister knows that the situation there is serious. There is to be an announcement today that will bring gloom and despair to the town against the background of the closure of the Carron company. When the Minister was pushing through the House his statutory instrument on the derating of external plant and machinery, I warned him of the devastating effect of the increased rate burden that he was imposing on other industries in my constituency. In a few hours we shall see the first casualties of his actions.
There is nothing to be cheery about on the job front in Scotland, despite what the Secretary of State tells us about the number of small business start-ups. We have had another major bankruptcy in East Kilbride today, in which the Scottish Development Agency has a major stake. Such bankruptcies are occurring one after the other. Almost daily we hear despairing announcements about the industrial scene in Scotland.
I could continue for some time on the subject of jobs, because the Scottish economy is in a desperate situation, but let me deal with housing, a subject dear to the heart of my hon. Friend the Member for Garscadden. Local authority and public sector housing in Scotland leave a great deal to be desired. Housing starts are at their lowest level. Local authorities are being starved of funds and there has been an attempt to deprive Falkirk district council of any housing start grant at all. If that action is carried out, the authority will have gone from a housing start grant of £8 million three years ago to nothing in 1983, all under this Government. That is a disgrace in anybody's language. Housing stock in Scotland, as the Minister knows well, because it is his responsibility, leaves a great deal to be desired, are all his policies are based on the altar of the ability to sell council houses. That is a policy that does not now bear examination because of the heartbreak that young couples are suffering due to the lengthening waiting lists in local authorities and their inability to get a local authority house.
Local authorities require more money because there is a great deal to be done to the immediate post-war housing stock, which, rightly, was built in a hurry because the needs were desperate at that time when men were coming back from the war and they and their families needed to be housed. But those houses are now 30, 35 or 36 years old and require a great deal of money to be spent on them. Indeed, there is a strong case for a scrap and build programme. Some of the older immediate post-war houses could be demolished altogether and replaced by new and modern houses. I know that the Minister will argue about loan charges, but, as my hon. Friend the Member for Fife, Central said, the Government are expert at producing money almost from nowhere to meet the whims of their mistakes in the Falklands. I am sure that they could produce money for the things about which I am talking.
Hon. Members talk to parents every week at their surgeries and we see them as we go round our constituencies. They are now becoming more and more worried about Scottish education. It is simply not good enough for the Government to say that they are spending more per head on pupils now than ever before. Somehow or other the Government seem to assume that because they spend more money they should be producing more O-grade and H-grade passes, and so on, as if that were the be-all and end-all of education.
As my hon. Friend said, the rate support grant settlement budgets for a reduction in the number of teachers employed in the Scottish education system. Discussions are now going on about the further contraction in the colleges of education where most of our teacher training is done. I am very much aware of the announcement by the Under-Secretary on Friday to introduce an all-graduate profession in the year beginning 1984. It will be 1988 before we get the results of anything from that. In that time enormous damage could be done to the Scottish education system as a result of the cuts in public expenditure to which my hon. Friend has referred.
Health is a subject dear to my heart. I have heard the Under-Secretary responsible for health, and the Minister himself, who had responsibility for health for three or four weeks, say that there are more nurses and doctors, and more this and that in the Health Service. The Minister knows that the Health Service is bursting at the seams. It is creaking under the strain because the Government have not yet published any building programme since the day they were elected. They are still working on the building programme left to them by the outgoing Labour Government in 1979. Not one brick has been laid under plans made by this Government for Health Service building. All the health centres and hospitals that have been built, and anything that is being built at the present time, whether it be a geriatric or a maternity unit, is part of the last Labour Government's building programme.
The Government have circularised all health boards. The Under-Secretary was at the Department when the circular was sent out telling the health boards in Scotland that before they could even ask for permission to build a new bed they must write to private hospitals to see if they had any spare beds. If there were any, the health boards had to buy those beds before they could get any permission or consideration to build new beds. The National Health service is becoming a two-tier service.
Ministers tell us that health boards are responsible for administering their own health board area. I believed that until a fortnight ago, when I read that the Secretary of State had overruled seven or eight health boards which had refused to accede to requests from consultants to use the National Health Service facilities for private practice.
The consultants have apparently appealed to the Secretary of State. The right hon. Gentleman has overruled the very people whom he appointed to administer those health boards areas. In anybody's language, that is a disgrace.
The Minister has been given a difficult job because he has to justify the Government's economic policy against the background of the debate.

Mr. Donald Dewar: Impossible.

Mr. Ewing: My hon. Friend says "Impossible". The electors in Scotland will be the judge of this matter. We may debate this matter across the Floor of the House, but like my hon. Friend, I am convinced that sooner rather than later the electors will get the opportunity to judge the Government's record in Scotland. I think that the judgment will be harsh on the Conservative party and on Conservative Members of Parliament. Many of the small number present had better start looking for jobs. There are nearly 400,000 unemployed people in Scotland. Old-age pensioners will have their pensions reduced, folk cannot get into hospital, parents of school children are complaining bitterly about the schools, and there are lengthening queues for local authority housing.
The Minister must know from his CBI connections that industrialists are thoroughly sick of this Government. I was talking to some of them today in my constituency. They are all turning against the Government, and their judgement will be harsh, indeed, when the time comes. It will be interesting to hear what the Minister says. No doubt he will do his best to paint a rosy picuture, but there is no rosy picture. The Minister must know that. He has constituents, just as we have. He must know that the scene is very depressing indeed.

The Under-Secretary of State for Scotland (Mr. Allan Stewart): I agree with the hon. Member for Stirling, Falkirk and Grangemouth (Mr. Ewing) on at least one point. I congratulate the hon. Member for Fife, Central (Mr. Hamilton) on his choice of topic. It also goes without saying that hon. Members who are present, and those who are not, will no doubt return to some of the themes that have been raised.
I want to respond to the detailed points raised by both hon. Members, but before doing so I should like to tell them of a change in the procedure of reporting the details of public expenditure plans in Scotland. I hope that it will be helpful to all hon. Members. In the past, my right hon. Friend has provided the Select Committee with a detailed memorandum on the public expenditure figures, and that has subsequently been published. This year, we propose to bring forward the programme, and the detailed commentary on the figures will be published in the very near future.
Let me put the debate into a general context. The Government have sought progressively to reduce public expenditure as a proportion of national output as a necessary condition to reducing inflation and freeing resources for the private sector to use productive, wealth-creating enterprise. Unlike Labour Members, we believe that that is the only sure way forward. We must create a sound base for a healthy economy in the medium and long terms.
Within that general context of restraint, resources have been channelled to priority programmes such as law and order, health and defence. We have also tried to sustain the capital programmes.
In total, the provision for 1983–84 is an increase of about 5 per cent. over the plans for 1982–83. That is broadly in line with expected inflation. The hon. Member for Fife, Central seemed to quote press reports suggesting that the Government's inflation forecasts would not be achieved, but later admitted that inflation was currently running at about 5 per cent. The Government have been extremely successful in the battle against inflation—a great deal more successful than most of the forecasters envisaged.
Looking ahead to 1984–85 and 1985–86, increases of 3 per cent. overall are planned for the programmes under the Secretary of State's control.

Mr. Dewar: In the housing projection up to 1985–86, there is a cut in cash terms of 9 per cent. Presumably the Minister will have done the calculation, so perhaps he will tell me what that is in real terms, assuming that the anticipated inflation figures are in reality.

Mr. Stewart: I shall come to housing, but I should first like to put the broad picture.
We must not compare the Scottish programme with the United Kingdom programme as a whole. Some misleading comparisons have been made, but not by the hon. Member for Fife, Central tonight. Scotland also benefits from United Kingdom programmes such as defence and the externally financed expenditure of the nationalised industries. When we compare like with like, there is a 3 per cent. increase each year for the Scottish programme, and that is on a par with increases in the comparable English programmes.
The hon. Member for Fife, Central referred to table 1.14 of the White Paper and claimed that, because the

figure for the Scotland programme in 1983–84 is £170 million less than the expected outturn for 1982–83, this showed a neglect of Scotland's interests. I think that that is a reasonable summary of what he said. Quite apart from the qualifications that should hedge about any argument on cost terms comparisons, the cost terms figures for 1983–84 look low simply because the 1982–83 figure is so much higher than it should be because of spending by local authorities. If that is discounted, the so-called cut in real terms shrinks to vanishing point.
Hon. Members should pursue that line of figures backwards. They will then find that even without making allowance for local authority overspending the Scotland programme for 1983–84 in cost terms is still higher than it was in 1978–79, the last full year of the Labour Government. That puts into context some of the more extreme statements that have been made about savage cuts, cuts to the bone, and so on.
On housing, the hon. Gentleman's figure of 20 per cent. is wholly misleading. Real comparisons in cost terms are a poor way to judge expenditure plans. Not only do they suffer from the deficiencies surrounding any cost terms figures, but the allocations to the housing programme, as to any programme, must be set against the needs of the programme. There is an overall surplus of houses over households and there are about 29,000 empty public sector houses in Scotland. There is also enormous scope for a far greater contribution from the private sector, and housing starts are rising sharply. Against that background, it is perfectly right and reasonable that the housing programme should be concentrated on the needs of special groups and on rehabilitation, improvement and repair. That is a sensible policy which avoids the elementary mistake that has been made in the past of equating high public expenditure with good housing.
The hon. Member for Fife, Central also mentioned council rents. The current average council rent is less than 7 per cent. of the average earnings of a male manual worker in Scotland and an even smaller proportion of the average household income. That puts that complaint into its proper perspective.
Houses sold to sitting tenants are not, as the hon. Gentleman claimed, lost to the housing stock. They remain in the housing stock, and the total housing stock has increased by 50,000 houses since the Government came to power.

Mr. Dewar: The Minister makes a rather strange argument to suggest that there is no housing need in Scotland, but why does he regard the attempt to establish what the cash figures in the housing estimates mean in real terms as a misleading exercise? Will he answer the simple question that I asked? What would be the cut in real terms if his 5 per cent. and 3 per cent. inflation projections were met?

Mr. Stewart: I have already explained why the hon. Gentleman's figures for expenditure in real terms are wholly misleading. Not only do real comparisons in cost terms suffer the deficiencies surrounding any cost terms figures, but any programme must be set against the needs of the programme. That is the question to which the Government must address themselves. Of course there are housing needs and it makes every kind of sense to concentrate resources on improvement and repairs. Hon. Members also forbore to mention the financial incentives


that the Government have provided for improvement and repair in the private sector. Those incentives are extremely generous and have been so regarded by local authorities of all political persuasions, including Labour authorities.
The hon. Member for Fife, Central referred to the education programme. It must be seen in the context of the falling school rolls. We are faced with a 3 per cent. fall in pupil numbers this year. He also referred to the pupil-teacher ratio, he correctly quoted the figure for 1983–84 at 17·6, and 17·5 for the following two years. That figure compares with a figure of 18 in the last full year of the Labour Government in 1978–79. That shows that the provision for education is reasonable.
The hon. Gentleman, as the House would expect, referred to health. He knows a great deal about that subject. He was rather more cautious in his comments on the Government's plans in that area than about some of the other programmes. The provision for health and social work is £108 million higher than the expected outturn for 1983–84, with further increases in the later years of the programme. For health alone, the increase in 1983–84 is £101 million, which is more than 6 per cent. It is well in excess of the expected movement for programmes as a whole. That shows the priority that the Government are according to health. It will enable health authorities to meet new demands caused by demographic changes and by advances in medical techniques. It is important that inflation is kept under control. The real resources that will be available will depend on the level of inflation.
Opposition Members were critical of the Government's priorities for law and order and prisons. Most ordinary people would regard the priority for law and order as perfectly right and proper. They would regard it as highly desirable that there should be a modest growth—such as we are planning—in police numbers to meet estimated needs. I was taken aback by the criticism of the Government's provision for increased spending on capital for the prison service.

Mr. Harry Ewing: The Minister should not misquote me. I did not criticise police expenditure. I said that it was inevitable because of the reduced expenditure on the social programmes. The Government are fully responsible for the increase in crime and, therefore, the increase in the prison population. The two are linked. The Minister must not misquote me. The additional money that he is having to

spend on the police and the prisons is of his own making because of the reduction in expenditure on social programmes.

Mr. Stewart: I do not for a moment accept that analysis. The hon. Gentleman must know in his heart that the causes of rising crime are a great deal more complex than that—as Opposition Members constantly told the House when they were in Government. The Government are providing for increased investment in improving conditions in prisons. We are providing for the capital reconstruction of Greenock and also for the next phase of the development of Shotts prison. I would have thought that all hon. Members, irrespective of party, would support those priorities.
Both the hon. Member for Fife, Central and the hon. Member for Stirling, Falkirk and Grangemouth referred to industry and to jobs. Selective financial assistance to industry will continue at broadly its current level, as will the programme for the Highland and Islands Development Board. The provision for the Scottish Development Agency in 1983–84 is more than the agency has spent in any past year. Of course, there are undoubtedly serious problems that face the Scottish economy. Nevertheless, it would be cruelly misleading to those who are out of work for anyone to suggest that there is a serious prospect of quick and easy alleviation. The fact remains that the economy is in recession and that we cannot spend ourselves out of trouble in the way in which some Opposition Members seem to think we can. A massive injection of public money might bring some apparent short-term relief, but the lasting effect would be more inflation or high interest rates or both. That would inevitably lead to a loss of competitiveness and jobs.
It is essential to the employment prospects of industry and commerce in Scotland that the Government maintain their firm anti-inflationary policy. It is clear from the White Paper that the Government will continue to concentrate on their priorities. It is also clear that we shall seek realistic economies. It is essential to make more effective use of resources in the public sector. It is by maintaining a proper balance between the public and private sectors that conditions for the growth of industry and commerce will be created and maintained. that is what the programme, as set out in the White Paper, is all about. that is as important for Scotland as it is for the rest of Britain.

Orders of the Day — Shipbuilding Industry

Mr. Don Dixon: I am pleased to have the opportunity to debate the importance of the British shipbuilding industry, which is experiencing one of its most difficult periods since the 1930s. In spite of that, according to the chairman's statement in the 1981–82 annual report, British Shipbuilders kept within the £25 million target that was set by the Government and the trading loss was only £19·79 million.
It is vital that we have a Merchant Navy and the shipbuilding capacity to build and maintain it. The Merchant Navy is the main carrier of our national trade—98 per cent. by weight of our trade comes and goes by sea. The post-war growth in foreign fleets and shipbuilding is not the result of a failure by British shipbuilders, but of a combination of factors such as nationalism, changing patterns of world trade and, above all, financial taxation and other direct and indirect support that is given by foreign Governments to their home shipping and shipbuilding industries.
The world recession in trade has resulted in the shipping industry facing a worldwide crisis. Freight rates are now at their lowest level—a level at which shipowners find it impossible to operate profitably. Huge losses are being incurred by ships that operate in virtually all trades.
It was recently reported in Lloyd's List that some owners are chartering vessels at rates that just cover fuel and crewing costs, and do not take account of depreciation or return on capital. These problems have spawned a shipbuilding trade war, especially between western Europe and the Far East. Korean shipyards are now quoting prices that would only cover the cost of materials in European shipyards.
It has been said that even if British shipyard workers worked for no pay, we could not compete with some of the prices that are quoted by the Koreans. It is impossible to believe that the Korean and Japanese Governments are not protecting their shipbuilding industries to the hilt. Now is probably the worst time for the Government to introduce legislation—I refer to the British Shipbuilders Bill—which, rather than supporting British Shipbuilders, will result in greater insecurity and confusion. The proposed legislation bears no relevance to the industrial needs of the British shipbuilding industry. I am of the confirmed opinion that that legislation is pursuing purely political objectives, which could destroy the achievements of the five years since the British shipbuilding industry was nationalised. It may halt a number of major initiatives aimed at further improving the industry's efficiency and productivity.
Since vesting day, nine shipyards, three engine building facilities and three ship repair yards have closed, 25,000 jobs have been cut and a further three ship repair yards are being closed with a loss of 1,400 jobs in south Tyneside, the area that I represent. Just last week we were told that another 1,800 jobs would have to go, many in the north-east. People talk about the massive redundancy payments that the shipbuilding workers are alleged to receive. The average redundancy payment is less than £3,800.
Until now, all that has been with the co-operation of the trade unions. The dramatic decline in numbers of jobs, together with increased flexibility and mobility, resulted

in an increase of 15 per cent. in productivity by 1981. At the time of nationalisation there were 168 bargaining units in the industry. Different groups of workers competed against one another, with leapfrogging claims and demarcation disputes. Productivity suffered, costs rose and any innovation was regarded with widespread suspicion. One of the first major achievements of British Shipbuilders was to reduce the 168 bargaining units to two—one for the manual workers and one for the staff in the supervisory division. All pay and other conditions at national level are negotiated once a year. Leapfrogging and demarcation are now a legacy of the past. Each national wage settlement has been struck at well below the rate of inflation, with the result that shipyard workers have dropped from third in the wages league to 19th.
All that has been made possible because of the industrial democracy that was introduced when the yards were nationalised. The men are conscious of their responsibilities to the industry, which now communicates effectively. They are aware of the problems besetting the industry. There is a feeling of working for a total industry that is competing internationally rather than one company competing with another on the other side of the country or even on the other side of the river. That good will and co-operation will be lost if there is any fragmentation of the industry and industrial democracy is stopped as a result of the British Shipbuilders Bill. There will be confrontation with the unions at the worst possible time for the industry.
Robert Atkinson, the chairman of British Shipbuilders, in the 1981–82 report, said:
Britain as an island nation is, and always has been a strong maritime nation needing seapower, and by necessity this must continue to be the case. Shipbuilding plays a vital part in our nation's prosperity and in its protection. We have a capability that needs to be sustained and recognised as a national asset because a shipbuilding capability is not something that can be used intermittently, to be available when required. To be effective it needs continuous use, it needs constant improvement and continuous investment in men and materials. Once that capability is allowed to disperse it will not be recoverable. Shipbuilding like shipping is a national strategic industry and needs a declared national maritime policy. Britain remains one of the few major maritime nations in the world where the national requirements of shipping and shipbuilding are not linked.
Before nationalisation British Shipbuilders was subject to a number of reports—the Patten report in 1962, the Geddes report in 1966 and the Booz-Allen report in 1972. Investment in British shipbuilding then did not compare favourably with that in many European shipyards. A survey was carried out at the time of the Geddes report in 1966 which showed that there were assets of £825 for every many employed in the industry in this country, in West Germany it was over £1,000, in Italy £1,200, in Sweden £1, 800 and in Japan £2,800. There was little investment in British shipbuilding compared with our overseas competitors.
If we are not careful we shall have no one to build ships in the future. In 1979 more than 20,000 apprentices and trainee technicians were taken in to shipbuilding. In 1981 there were 10,000. Who will build ships in the future if we do not train apprentices and technicians?
I want to talk a little about the effects of the recession in the north-east where shipbuilding, repairing, and marine engineering have formed an important part of our industrial base. We have been top of the unemployment league for many years. I do not like talking about percentages when talking about unemployment because


we are discussing human beings—breadwinners and wage earners. An individual is 100 per cent. unemployed whether he is one of 15 per cent. or 20 per cent.
The northern region accounts for 20 per cent. of the United Kingdom's shipbuilding industry, and we were able to take advantage of the shipbuilding boom of 1973 because of our skills. In that year 51 per cent. of United Kingdom tonnage was launched from yards in the north-east. Nearly 8 per cent. of employment is in shipbuilding and connected industries compared with 2·5 per cent. nationally.
The concentration is higher in certain parts of the region. On Wearside 20 per cent. of the work force is employed in shipbuilding, ship repairing and engineering. On Tyneside the figure is 16 per cent. We have a completely integrated shipbuilding, ship repairing and marine engineering industry, which is not duplicated anywhere else in the United Kingdom.
Many organisations are connected with the industry. The university of Newcastle has the country's largest and foremost naval architecture department, which has closelinks with the industry. It also has a marine industry centre. Sunderland polytechnic has a department of naval architecture. South Shields marine and technical college is internationally known. The north-east has the greatest concentration of facilities for technical education directly connected with shipbuilding.
Shipbuilding is not just a job; it is a way of life because of the close relationship between the working and living environment. For example, a survey carried out at Swan Hunters at Wallsend showed that 62 per cent. of its work force lived in Wallsend or the adjacent towns. In Sunderland the survey showed that 37 per cent. of Austin Pickersgill's work force lived within one mile of the yard and only 15 per cent. lived more than five miles away. That is how important shipbuilding is to communities. The whole social and economic life of communities in our area depends upon shipbuilding. That is why the recession in shipbuilding has such an effect on those communities.
I want from the Minister, first, a national maritime policy co-ordinated by a senior Cabinet Minister, to be formulated in consultation with trade unions, British Shipbuilders and the shipping industry. That was suggested by the Select Committee, which interviewed trade union representatives, British Shipbuilders' representatives, and the Minister who will reply to tonight's debate. Recommendation (iii) of paragraph 43 states:
The Government should set up a high-level interdepartmental working group to consider the full implications of a maritime policy for the UK embracing both shipbuilding and shipping.
Robert Atkinson, the chairman of British Shipbuilders, said in an article in the shipbuilding magazine in November 1982:
I am convinced that there is only one way in which this can be achieved. There must be a single national body overseeing the interests of all the maritime industries and interests involved including defence. What we need is a Minister of maritime affairs or a Minister of the sea, as exists in France; a man of senior position within Government, who can evaluate the problems facing us all, and with the power to implement decisions.
Mr. Atkinson said that after the publication of the Select Committee report.
Secondly, British shipowners, Government Departments and nationalised industries should be told to buy British. Not long ago, P and O ordered one of the

largest cruise liners ever to be built, at a cost of £90 million, but the order went to Finland. We had arguments about the replacement of the Atlantic Conveyor after it was sunk in the Falklands dispute, and last week we had discussions about the CEGB cable boat, which is to be built in Korea. An article in the Sunderland Echo on Wednesday 2 February stated:
A £10-million contract which could have saved shipbuilding jobs on the Wear is believed to be going to Korea. Sunderland Shipbuilders, which had put in a bid … to carry out work for the Central Electricity Generating Board, had been 99 per cent. certain of winning the contract. The barge, for delivery in March next year, would have filled the gap at the Deptford yard which would have seen them over an extremely lean period this year, and saved many jobs. Today there was anger at the yard that the contract may go to the Far East, and Mr. Fred Willey, M.P. for Sunderland North, is taking up the matter.
The cable-laying is being sub-contracted out by the CEGB and Sunderland Shipbuilders were told that their tender was the lowest in Europe and even matched Far East tenders. 'When the yard heard the order was to go to Korea everyone was extremely angry', said a Sunderland Shipbuilders spokesman.
One can understand why everyone was extremely angry, because in Sunderland we have one of the highest unemployment rates in the country. This order would have saved many jobs.
Paragraph 43(v) of the Select Committee report states:
The Government should remind all public authorities of the desirability of buying British materials and components and also ships built in British yards.
British Shipbuilders does so. Last year, British Shipbuilders placed orders of £550 million with United Kingdom-based companies.
The British Steel Corporation is a major recipient of such orders. In 1980, the British Steel Corporation supplied 189,200 tonnes of heavy plate to the shipbuilding industry; in 1981, 138,000 tonnes; in 1982, on current orders, 164,000 tonnes with estimates for 1983 of 202,000 tonnes. That represents 95 per cent. of the heavy plate requirements of British Shipbuilders and the orders were placed with the British steel industry. British Shipbuilders pursues a "buy British" policy. One would hope that other nationalised industries would reciprocate, and build and buy ships from the British shipbuilding industry.
My third suggestion is the introduction of a scrap and build scheme with credit terms for British shipowners to order ships in British yards. On page 30 of the Select Committee report it is pointed out that some years ago, under a previous Government, Britain grantee aid for shipowning of about £450 million of taxpayers' money, of which about £133 million was spent in Britain. The rest went for orders overseas to build up the asset strength of our competitors in Japan. There should be credit facilities for British shipowners to build their ships in Britain.
A Member of the European Parliament recently asked to what extent EC shipowners placed ship orders in European shipyards. The United Kingdom placed orders in Community shipyards to the extent of 13·3 per cent.—the highest percentage of ships built in other yards. The United Kingdom built only 47 per cent. of its ships in British yards, while Germany placed orders for 79 per cent. of its shipping in German yards; Belgium 94·6 per cent.; Denmark 84 per cent.; France 91 per cent. Britain was bottom of the league.
My fourth suggestion to help British Shipbuilders, certainly in the short term, is to create enterprise zones on both sides of the River Tyne and on both sides of the River Wear. That would assist British Shipbuilders and the local authorities. In West Germany, according to the evidence


given by Robert Atkinson to the Select Committee, local authorities can help German shipbuilders. In Britain, they cannot. If the Government were to make enterprise zones on both sides of the Rivers Tyne and Wear, it would help the shipbuilding industry and the local authorities.
My final suggestion is the withdrawal of the British Shipbuilding Bill, which is at present in Committee. If the Bill is enacted, it will cause confrontation with the trade unions at the worst possible time for the British shipbuilding industry.
I say that with all due defence to the Minister.
A shipbuilding conference was held in Blackpool on Monday 24th March 1980—there has been another meeting since then—at which the following resoulution was passed:
this Conference of Manual Employee Tradesmen, and General Workers, Office Staff, Technical Staff, Supervisory and Management Staff of British Shipbuilders accepts absolutely, the need for the most harmonious and close working of all parties within the Industry in order to steer the Industry through the present-continuing difficult World Marketing situation, and of course to provide the maximum employment for our members.
We reaffirm that such relationships can only be maintained on the basis of the Industry retaining its present nationalised Form, under Public Ownership.
We therefore reject totally any attempt by the Government to introduce any element whatsoever of de-nationalisation, whether it be Hiving-Off or Sale of Shares.
In the event of any such proposals being brought forward by the Government, we call upon the Shipyard Negotiating Committee to arrange an immediate reconvening of this Delegate Conference to consider positive action to oppose any denationalisation or hiving-off proposals.
This Conference also confirms that with our co-operation to date, on the re-structuring of the Industry, the introduction of centralised bargaining, the acceptance of flexibility and changes in working practices and the acceptance of self-financing Productivity Schemes have all been forthcoming on the basis of progressing the successful future of the Nationalised Shipbuilding Industry. Any necessary re-assessment of our position arising from any Government proposals to commence `dismantling' in whatever form would require us to consider our future attitude to the items listed in Paragraph Four.
I genuinely believe that the Minister has the industry at heart. I suggest that if the British Shipbuilders Bill goes on to the statute book we shall have confrontation at a time when the shipbuilding and shipping industries can least afford it. I hope that the Minister will respond positively to the issues that I have raised.

Mr. Harry Cowans: I think that my hon. Friend the Member for Jarrow (Mr. Dixon) is the one Member of this place who has worked in the industry. I am pleased to have the opportunity to take up his remarks briefly and to raise two or three additional issues.
It seems nonsensical that we place orders for ships with countries such as Korea and Taiwan. If we continue to do so, there will be no British shipbuilding industry. If that happens—it may very well happen—where will the ships be built? If the present policy is implemented and we destroy the shipbuilding industry, ships will not be built in Britain. I ask the Minister seriously to consider whether that is what he wants.
As my hon. Friend the Member for Jarrow has said, there has been co-operation right across the board by the

trade union movement on the Tyne and Wear. Contrary to what the Conservative Government say, we on the Tyne have a remarkable record of building ships.
I fear that we are in danger of destroying an industry on the Tyne, and of putting nothing in its place. We may find that having destroyed shipbuilding, despite the co-operation of the trade union movement and the management, there will be nothing left on the Tyne. Where will the Minister then go for the ships that the Tyne supplied when Britain faced its greatest crisis of recent years? We turned out the ships to the Falklands, but if the industry is destroyed, heaven forbid that that crisis ever comes again.
The Minister should think hard, because if the industry is destroyed and Britain is in trouble again, where will he turn to for the ships and the co-operation that he got on the Tyne? He should think hard before destroying the industry, as he is in grave danger of doing.

The Minister of State, Department of Industry (Mr. Norman Lamont): I pay tribute to the hon. Member for Jarrow (Mr. Dixon), who is assiduous in supporting the shipbuilding industry and speaking out for it in the House. Having been with him for some weeks in Committee on the Shipbuilding Bill, I know of his expertise and knowledge of the industry and his hard work on its behalf.
The hon. Member's speech was full of realism, and he did not deny the problems that shipbuilding and shipping face worldwide. He referred to the pressure, for example, on freight rates. The whole of western European shipbuilding is under enormous pressure. Despite a substantial reduction in production, here, in western Europe and in Japan, there is still far too much shipbuilding capacity chasing far too few orders. That is a problem from which we cannot isolate British Shipbuilders.
I cannot hide from the House the fact that the industry faces tremendous problems and will be under pressure for some time to come. While the Government accept—and I have gone out of my way to emphasise this in Committee—that merchant shipbuilding will need support for the foreseeable future, the success of the industry in withstanding the pressures of the market must depend primarily on the competitiveness that we need.
The industry has made progress, as both the hon. Member for Jarrow, and the hon. Member for Newcastle upon Tyne, Central (Mr. Cowans) have said. It has made progress under Sir Robert Atkinson, as he now is, but a considerable amount remains to be done. The future of our shipbuilding industry lies to a noticeable extent in the hands of the industry. Management and work force must work together.
I agree with both hon. Members who have spoken that there has been a good record in the recent past of co-operation and moderation in wage claims. That is the way in which we can develop the efficiency and competitiveness that we need. We have, as the hon. Member for Jarrow knows, continued with the intervention fund, which we use to enhance the competitiveness of our merchant shipbuilders. The purpose of the fund is to put us on a more equal footing vis-a-vis competition from the Far East.
Up to January of this year, support under the scheme approved for British Shipbuilders amounted to £248 million. The fifth directive on shipbuilding aids has been


renewed and we expect that the Commission will very soon approve the continuation of the intervention fund up to mid July. We shall shortly be in touch with the Commission on shipbuilding support after July.
Of equal importance is our support for the restructuring of the industry. If we are ever to be competitive with the Far East, we must make efficient use of labour and capital. That process of essential adaptation is supported by the shipbuilding redundancy payments scheme. To date there have been some 22,000 beneficiaries, and the total amount paid out in benefits is approxmately £62 million.
Both the hon. Member for Jarrow and the hon. Member for Newcastle upon Tyne, Central naturally referred to the recent publicity given to the Central Electricity Generating Board barge. Of course, the Government would much have preferred that order to go to British Shipbuilders. As my hon. Friend the Under-Secretary of State for Energy emphasised this afternoon, the barge was not being purchased or owned by the CEGB. It was using an intermediary. He also emphasised that when the tenders were received by the various intermediaries there was such a big difference in price that the board—because it was anxious and would have preferred the order to be placed in Britain—asked that tenders should be resubmitted. Unfortunately, there were still huge differences in the tenders and tender prices. I am afraid that the British Shipbuilders bid was a long way out, and the extent to which it was out was such that it could not have been bridged by the intervention fund or by Government intervention.
Both hon. Members asked about public sector purchasing policy. We have such a public. It says, not that we must always buy British in the public sector, but that public sector authorities should be aware of and take into account the industrial consequences of their decisions. We accept that British firms and British nationalised industries should be given the opportunity to compete. In this instance, British Shipbuilders was given the opportunity to compete and the CEGB requirement went to tender twice.
The CEGB's requirement was for the hire of a vessel for 12 to 18 months to bury cables between England and France. The tenders, therefore, did not reflect just the purchase price of the vessels. The hirers would be the operators of the barge, and in quoting prices that had to be allowed for in the expected utilisation of the vessel over its commercial life. Therefore, it is not possible to say that International Transport Management won the charter simply because it intended to buy the ship in Korea. However, I stress that we would have preferred the order to go to Britain.
As the hon. Member for Jarrow said, British Shipbuilders has achieved much in its five years of existence. A disparate group of more than 40 companies has been pulled into a divisional structure and central financial control has been greatly strengthened. As has been said, until this year the corporation has been able to stay within a reducing external financing limit. The point was made that the corporation faces a renewed recession in world merchant shipbuilding, marine engineering, ship repair and in offshore activity.
In Committee, the hon. Member for Jarrow and I have discussed productivity. As I have said before, productivity has not been all that was hoped for. Productivity, which I admit is difficult to measure in the shipbuilding industry, slumped during the recession, when yards had gaps in their

work load, but it improved as order books strengthened. However, in a period of recession it must be doubtful whether British Shipbuilders can sustain the improvement achieved during the past two years. Despite improvements, productivity levels still have to surpass those of the pre-nationalisation days.
I shall say a little about the financial performance of British Shipbuilders. In 1979–80 losses amounted to £110 million. In the two subsequent years they fell to £41 million, then to £20 million, but the improvement has proved temporary. At the half year, British Shipbuilders announced losses of £28 million, which, as the hon. Gentleman said the other day in Committee, is already substantially over the loss target of £10 million that we had set for the whole year.
These overall figures disguise an even more worrying underlying picture. Warship building is the profitable part, while merchant shipbuilding is making substantial losses. The Falklands replacement orders announced before Christmas are good news for the corporation, providing additional work for Yarrow, Swan Hunter and Vosper Thornycroft. A further frigate order will be placed next year, but the corporation still needs to stick to its long-term aim of improving its warship export sales. That will be extremely difficult, because the corporation has not had a major warship export order for the last 10 years.
The offshore market also faces great difficulties. Cammell Laird recently won the British Gas Morecambe bay order, but it will soon need another to follow on. Losses in the offshore division last year amounted to £21 million.
The hon. Gentleman is well aware of the problems on ship repair. Many of the Tyne ship repair yards that have been closed are either in his constituency or near it. Losses in ship repair last year came to £7 million and action was needed to stem the considerable losses at Tyne ship repairers. All this has meant continuing and substantial Government support—£600 million since we came to office.
The hon. Gentleman said something about European shipbuilding policy. Within Europe we have sought to maintain a framework of aid for shipbuilding which would allow the European industry to adapt to the changes in the world market and prevent a pointless subsidy race with our European competitors. The EC countries have recognised that in the present market conditions aids are necessary, but that we should reduce them progressively and together.
The level of United Kingdom aids is sometimes criticised, as the hon. Gentleman has done, but taking direct aid and credit together, we believe that the United Kingdom assistance compares well with what is available in other countries. In some countries—for example, Belgium and Denmark—shipbuilding credit schemes are more favourable than ours, but their credit, unlike ours, is in principle open to their shipowners, whether they build at home or abroad, and I emphasise that they do not, as we do, give production subsidies as well. If one assesses the combined value of credit and production subsidies in the major shipbuilding countries, the United Kingdom in terms of support comes about the middle of the league. That is before one takes account of the financing of losses, the injection of public dividend capital into British Shipbuilders, which is a substantial additional support available to BS and which is not available to many of the European shipbuilders, many of which are privately owned and do not receive support of this nature.
The introduction of a scrap and build scheme has been suggested several times as a way of helping the industry. We do not believe that a scrap and build scheme would be more cost-effective than existing measures of support. We are opposed to adding such a scheme to existing subsidies, as this would run counter to our policy and to the European policy of reducing state aids. The question of a scrap and build policy was at one time explored but commanded little support within the EC. It is also doubtful whether such a scheme would be effective in current market conditions, when many ship owners are thinking of scrapping or selling to get rid of tonnage and do not want new ships.
There has been reference to a maritime policy and the work of the Select Committee on Trade and Industry. The Government have a maritime policy designed to promote the interests of shipbuilding and shipping. We are opposed to any change in that policy that would have the effect of increasing aid to shipbuilding at the expense of the shipping industry. We have to look at the two together. They are closely related. One can easily damage the other. We set out our views on a so-called maritime policy in our response to the Select Committee report which was published earlier this year.
A proposal canvassed by the chairman of British Shipbuilders is the appointment of a Minister for the sea. I hesitate to cross swords with the chairman of British Shipbuilders, but I wonder whether that is not really a rather gimmicky approach. It is a good phrase. What does it mean? We consider that the existing administrative arrangements operate well. The Secretary of State for Trade has the primary responsibility for co-ordinating policy on maritime matters, but other Ministers take the lead in areas closely connected with their own Departments. It has been emphasised time and again that there is close co-ordination between the Department of Industry and the Department of Trade on these issues.
There has been reference to the Booz-Allen report, the Patton report and the Geddes report, which have commented on the inefficiency of British shipbuilding under private ownership. I am well aware of the criticism contained in the reports. None of them suggested that nationalisation would be an answer to the problem. The thrust of the reports means that remedies could be found without a change of ownership.

Mr.Cowans: Both my hon. Friend the Member for Jarrow (Mr. Dixon) and I have stated that the primary worry is the decimation of the shipbuilding industry in this country. Can the Minister name one Japanese ship that was built outside a Japanese yard? While the Japanese have a policy of building at home, we build overseas. The day will come when we shall have no shipbuilding industry and the Japanese will hold us to ransom.

Mr. Lamont: I cannot name a Japanese ship that has been built in a British yard. Japanese ship owners choose to build in Japanese yards. The yards are highly efficient. Rates of interest are very low. Japan is a low-inflation country. Those are the factors that influence Japanese ship owners.
I spend much of my time trying to persuade and appealing to British ship owners to place orders in British yards. It is precisely because part of my concern is the health of British shipping that at the end of the day I am

not prepared to compel British ship owners to place orders in British shipyards against their will. The hon. Gentleman knows as well as I do that British ship owners do not always want to place orders in British yards. That may be regrettable, but it is unfortunately true.

Mr. Dixon: The Minister said that the Patton report, the Geddes report and the Booz-Allen report did not suggest nationalisation of the shipbuilding industry. I accept that the Patton report and the Geddes report did not. The Geddes report suggested that there should be rationalisation and that a shipbuilding industry board should be set up to finance that. However, the Booz-Allen report, which was virtually a plan for nationalisation, criticised the British shipbuilding industry. The nationalisation plans which were accepted by the 1974 Labour Government were virtually based on the Booz-Allen report.

Mr. Lamont: None of the three reports recognised or even implied that nationalisation was the answer. The Geddes committee was specifically asked to consider the industry's structure. Indeed, the very fact that it did not recommend nationalisation could be taken to imply that it felt that remedies could be found which were separate from the ownership of the industry.

Mr. Dixon: What about the Booz-Allen report?

Mr. Lamont: The hon. Gentleman is not right to imply that the Booz-Allen report in any way suggested that nationalisation was the answer, but perhaps that is an argument that we can continue in Committee.
The hon. Gentleman also touched on the impact—it is natural that he should—of the recession on shipbuilding and the tremendous job losses in his constituency. I understand and sympathise with the concern that he feels. After visiting his constituency last week and talking to some of the people who had been made redundant at Readheads, I well understand the anxiety and despair that is felt there because of the failure of new industries to come into the area fast enough to take up the job losses in shipbuilding. I cannot give an easy answer to the question. All I can say is that the Government are giving to his and other constituencies in the area all the aid that they possibly can.
As the hon. Gentleman is well aware, his constituency has special development area status. The northern region—not just his constituency—has more assisted area status than any other region in England. Over £36 million in regional development grants has been paid to companies in south Tyne since May 1979 and in the same period, under section 7 of the Industry Act 1972, selective assistance has been offered in 45 cases, involving over £10 million. Regional development grants paid in the northern region in 1981–82 totalled £143 million, which is higher than for any other region in England. Indeed, it accounts for 23 per cent. of the total regional development grants paid out.
The hon. Gentleman asked for an enterprise zone in his constituency and on both sides of the Tyne. There are two enterprise zones near his constituency. He may feel that they are not a direct benefit to his constituents, but we had to bear in mind the proximity of other enterprise zones when making decisions about new ones.
I assure the hon. Member for Jarrow that we in no way underestimate the tremendous social strains and problems


created by the level of unemployment in his constituency. I am always pressing for productivity improvements and the need to be competitive, but I well understand the human implications involved.
The hon. Gentleman talked about the British Shipbuilders Bill. He made an appeal that we should withdraw it, as he thought that it was damaging. He will not be surprised to hear that I cannot agree to that. The purpose of the legislation is to develop the industry's strengths without the taxpayer having to pick up all of the bill.
I have said again and again that the merchant shipbuilding sector is unlikely to attract private investment. I emphasise that it will continue to be supported by the Government for the foreseeable future.
Warship building is a separate question. That may attract interest. Those companies should not be starved of capital investment because of the losses of the rest of the corporation.
The hon. Gentleman implied that privatisation of part of British Shipbuilders might lead to a break-up of the national agreement with the unions. The Bill is an enabling measure. Its passage will not lead to an immediate and total privatisation of British Shipbuilders activities. I see no reason why, following any disposal of those parts of the shipbuilding industry remaining in public ownership, British Shipbuilders should not continue to negotiate in a unified fashion if that is judged to be in the interests of the industry.
Finally, I strongly agree with what the hon. Gentleman said about the great technological expertise in the higher educational institutions in his region. He referred to Newcastle university and Sunderland polytechnic. I agree that it is extremely important that the shipbuilding industry and those institutions should have the closest possible links. We hear a lot of talk about the new technology being

applied to new industries. What is important is that the new technology should be applied to the traditional industries. That is the way in which we can compete with everyone.
The hon. Gentleman asked me the unanswerable question of how the Koreans manage to quote the prices that they do. How can we compete with the Koreans? Even if we worked for nothing, we still would not be competitive. One way is to harness modern technology to shipbuilding. I endorse everything that the hon. Gentleman said about establishing the closest possible links between the local universities and polytechnics and British Shipbuilders. There is a remarkable reservoir of technical knowledge there. I know that and the Koreans know that. They have even employed some. That emphasises the world-leading technology in those institutions.
I am convinced that the combination of our policies of support for the industry and the new horizons being opened up by the British Shipbuilders Bill are right for the industry. Much has been done, but much remains to be done. There needs to be a continuing assault on costs and productivity. British Shipbuilders will have a hard task maintaining the pace of improvement of recent years in a deteriorating world market.
I hope that hon. Members will take home the message that the Government are providing support and help to the industry and will continue to do so. The Government cannot solve all the problems. We cannot conjure up orders out of thin air. The industry must attack its own costs and boost its own productivity. Increased efficiency is the only route to increased competitiveness. Competitiveness is the essential ingredient in the industry's future. A partnership between the Government and the industry is essential for competitiveness.

Orders of the Day — Wales (Nationalised Industries)

Mr. Ray Powell: I have listened to a number of speeches today; and most have proved informative, especially those in the debate on shipbuilding initiated by my hon. Friend the Member for Jarrow (Mr. Dixon). Nevertheless, to begin one's speech at 3.19 am, having attended for Welsh questions at 2.30 pm, must seem to those outside this building to be bizarre, to say the least.
I hope that the Minister will try to answer my questions and not treat the debate with the contempt with which the Secretary of State treated Welsh questions earlier in the parliamentary day. It is no joke to stay up all night waiting for one's debate to be reached. Because of the importance of the subject, because it concerns thousands of jobs in Wales and our basic essential industries, and because there are 180,000 unemployed in Wales, I hope that these matters will receive attention and that the Minister will respond positively and will persuade his colleagues within and outside the Cabinet to act more responsibly.
The Consolidated Fund Bill is a very short, one-page Bill. Clause 2 refers to issuing to
Her Majesty for the service of the year ending on 31st March 1984 the sum of £35,955,985,500.
That is a colossal sum. We are debating the Government's expenditure plans for 1983–84 to 1985–86. Volume 1 of the White Paper costs £5·10 and volume 2 £9·75, so I doubt whether many of my constituents in Ogmore or indeed many people in the Principality will have purchased copies, although it directly affects their lives.
The White Paper also sets out the Government's plans for 1984–85, although I cannot understand why they should wish to go beyond June this year, which I hope will be the end of their term of office. According to the index, Government lending to nationalised industries is dealt with on page 26 of volume 2. There we discover exactly what the Government have to offer—a blank page and a reference to part 3. Careful study of part 3 enables one to determine the expenditure on fixed assets. The table shows that in 1977–78 under the Labour Government the capital requirement of the British Steel Corporation was £502 million. In 1982–83, under the Conservatives, it was reduced to £183 million, and for 1983–84 it is estimated at £270 million. For 1984–85 and 1985–86 the figures have yet to be determined, but the House may be assured that with the return of a Labour Government the amounts will be substantially increased.
I shall not go into all the details contained in the documents. First, I wish to examine briefly what Government policy since 1979 has done to our great steel industry. Since "slim-line" was introduced in 1979, the manpower employed has been reduced from 166,000 to 85,000 in 1982. All over Britain iron and steel works are silent, and good, healthy, trustworthy, hard working men are idle, helpless, hopeless and searching for a job. Those who are left are realising their fate and are expressing total opposition to any further cuts and reductions. Manpower and steel production has fallen faster than anywhere in the Western world.
In Wales, there has been a rapid decline since 1979. In Ogmore, where thousands of my constituents worked in the Port Talbot steel works, demanning has caused devastation. Unemployment escalated, coal demand

dropped and other industries supporting Port Talbot, Llanwern, Shotton and Ebbw Vale steel works caught the backlash, resulting in massive unemployment.
That unemployment was not phased, nor were jobs sympathetically trimmed down. The steel industry was just butchered by MacGregor, the right hon. Member for Pembroke (Mr. Edwards) and the then Minister for Industry, planned and manipulated by the biggest problem in the steel industry—the occupier for the short period left of No. 10 Downing Street, the right hon. Member for Finchley (Mrs. Thatcher). Her policies have cut manufacturing by a fifth; caused record bankruptcies; cut manufacturing investment by a third; destroyed more than 3 million jobs; pushed manufacturing imports up by a fifth and encouraged overseas investment. Apart from the misery caused by these policies, they have all cut steel demand.
For example, the car industry now needs only 15,000 tonnes of steel a week, whereas in 1979 it required 21,000 tonnes. The Tory slump in 1980 and 1981 caused the industrial sector to drop demand by 30 per cent. and even more for 1982. In Europe, steel unemployment is 5·3 per cent., but for the same period in the United Kingdom, job losses have amounted to 11·7 per cent. How many more jobs will we lose, and when will those who remain be content with any sort of job security?
This should be the plan for steel—emergency action under article 19 of the General Agreement on Tariffs and Trade to prohibit damaging imports from non-EC countries; an immediate review of trade balances with EC countries and the introduction of restrictions where the gap is unacceptably wide; BSC powers to move massively into stockholding and to take a tighter grip on the trade; and a Government commitment to keep energy prices to industry to the general EC level, thus putting the BSC on a competitive footing. But, more importantly, we want a Government committed to a crash economic expansion programme through construction, investment and producer goods, all of which will require increased steel making.
My last word on this subject relates to the press rumour that this butcher of the steel industry might be pushed over to make a further disaster area of the coal industry. I hope that that attempt will be dismissed, because putting the lid on pits will be much more difficult than slashing the steel industry.
The south Wales coal industry has also suffered at the hands of the Government's mad monetarist policies. I hope that this essential industry will have better treatment in the years ahead than it has received in years past. I have witnessed the ghost valleys left after pits have closed, with little, if any, help provided. I have read the list of pits on the danger list. I hope that my suggestions will be taken in train by the Minister, the Government and the NCB.
I was pleased to learn recently that the mine workers in South Wales decided to abandon the strike action called for 17 January, having been promised a meeting with officers of the NCB. That meeting took place with the chairman of the NCB and other officers, and an undertaking was given by the NCB that the proposals for future investment in the South Wales coalfields would be seriously considered, and that the regional officers in South Wales would meet miners' representatives to discuss certain aspects of the proposals put forward by the National Union of Mineworkers at area level. Those


meetings are taking place, and firm promises on some of the proposals have been made by the NCB. I hope that the meetings will continue, and that they will be fruitful.
I shall summarise the NUM proposals both at national level and for South Wales. It wants major replacement units at the Glyncastle new mine and the Margam new mine. It wants major extension and reorganisation of existing unit plants — the Ancit replacement at Aberaman, the new drifts at Aberpergwm, and Nantgarw, washery and coal preparation plant reconstructions at most major units, east side development at Betws and lower measures development at Abernant. It wants exploration surveys in the Glyncastle-Whitworth area east of the Neath valley; in the deep measures of the anthracite reserves especially around Trimsaran, Blaenhirwaun-south, Pantyffynon — Wernos south, Betws-south, Cwmgwili and Abernant; on the southern—central rim of the coal field from Margam to Llantrisant; of the deeper measures to the north of the Garw, Ogmore and Mon valleys. It wants the NCB to deal with the association problems requiring urgent capital investment on recruitment, general replacement and updating of powered supports and pit machinery, including shield support faces where possible.
I want to discuss two of those proposals in detail—first, the proposed new mine at Margam and, secondly, the Aberaman Phurnacite plant. I initiated a debate on 14 December 1981 on the issue of a new mine at Margam. Indeed, it appears that the Government and the NCB are burying their heads in the sand and not recognising the benefits that could accrue if that mine was developed. For a number of years the NCB has considered sinking a new mine at Margam. The reasons for not doing so are that the NCB is not receiving sufficient money for investment and that it is starving South Wales of urgently needed improvement. It prefers to use its admittedly inadequate resources in other regions. The Government are starving the NCB of money to modernise the industry to enable it to provide a solid energy base for the future. The Government are showing a pathetic, narrow-minded, typically Tory attitude to the needs of the coal industry, especially in Wales. Britain will regret that in the next and future decades.
According to the NCB's experts, the proposed new mine at Margam would provide 50 million tonnes of high quality coking coal. The NCB has considered extracting 1 million tonnes per year. The main obstacle is investment. High interest rates plus the £160 million to £200 million capital cost and the low level of international prices mean that the NCB cannot be sure of an operating profit in today's circumstances.
The new mine could be viable if, at today's costs, the NCB did not incur interest charges or if the United Kingdom cost increases kept below future increases in world coking coal prices. However, the cash limit constraint on south Wales could militate against new investment at Margam, even when the NCB was satisfied with its viability.
That is where far sightedness by the Government is essential. They must take account of the longer-term strategic interests of the coal mining industry, rather than base investment decisions that are crucial to south Wales in the 1990's and the next century on financial returns from and during a period of recession. The new deep mine at Margam would make available 50 million tonnes of prime coking coal, employment for 1,000 people during

construction and employment for 1,000 people when it is operational. Moreover, it would probably inject about £12 million each year into the local economy.
How much would it cost the Government to attract that number of jobs through their regional policies? How certain can we be that, the nation having spent considerable sums of money on attracting that number of jobs, they will still exist in 10 years' time and that the enterprises will make valuable sources of energy available to Britain to the end of this century and well into the next one? Nobody can doubt Wales's need for 1,000 new jobs. The Government should take that important factor into account when they evaluate the Margam project. They should also seek additional financial support for the project from the European Community.
I should like now to deal briefly with the Phurnacite plant at Aberaman. It produces smokeless fuel by the Dista coke process. It is an old plant that is subject to creating severe environmental problems through air pollution. They arise from the out-dated process and are made worse by its being in a valley. Two million pounds has been spent to ease its detrimental effect on the people who live nearby and on the environment generally, but circumstances are still far from satisfactory. The clean air inspectorate says that the works are still by far the worst source of air pollution in the district, and possibly in the country. The design of the process is such that no addition to the layout as it is can cure or even make a satisfactory improvement in the environment.
It is considered that the only satisfactory solution is to introduce a new process—Ancit—to replace Dista coke for the production of Phurnacite. That would mean rebuilding the whole plant. The cost of rebuilding and introducing a modern process is estimated at £35 million. In June 1981, the Government refused to give the NCB any assistance and it was unable to proceed. The Government's decision was taken on narrow, short-term financial considerations. They must re-examine the subject and take a wider look at the troubles that a new Phurnacite plant would solve and the benefits that it would bring to the environment, the NCB, the coal industry and employment in the valley where unemployment is now at a rate of more than 18 per cent.
The NCB wants to retain the Aberaman plant—without it, the market for smokeless fuel would collapse. The plant employs 1,000 men and 4,500 miners who produce the dry steam coking coal that the plant needs.
That is what the Government need to take into account in deciding on the aid for the NCB for updating the Aberaman Phurnacite plant—not narrow commercial considerations, but the improvement of the environment, a powerful consideration in itself, the safeguarding of the market for domestic fuel and the 5,500 jobs involved in an area of extremely high unemployment.
The escalation of unemployment in Wales was caused by demanning in the steel industry and the rundown in the coal industry. The Opposition constantly warned the Government and expressed great reservations about the action that the Government were taking in their first months of office. We were accused of over-indulgence in condemnation. However, in three and a half years, what has happened to the economy of Wales? What has happened to unemployment there?
At Welsh questions today the Secretary of State for Wales replied to a question that I asked about the number of people out of work in 1979 in comparison with January


1983. On 13 January 1983, unemployed claimants in Wales totalled 180,664, an increase of 134·1 per cent. over the May 1979 figure of 77,177. In my constituency there were 6,061 unemployed in January 1983, but there were no comparative figures for May 1979. The number of people employed in Wales in June 1982 totalled 877,000, a fall of 145,000, or 14·2 per cent., since June 1979.
Those figures alone are a condemnation of the Government's policy and purpose. The regional impact of unemployment in Wales needs to be seriously considered. Nationally, more than 1 million people have been on the unemployment register for 12 months or more, just about the same as the total number of people who were out of work when the Government took office. More than 32 per cent. of the unemployed have been out of work for more than 12 months. That alone is an indictment of the Government's bizarre monetarist policies.
Wales's figures are worse than the national figures. The Minister might take time to tell us of the remedies that he has to offer, not for increasing unemployment but for reducing it without the aid of his unfrocked chartered accountants.
Under the Labour Government, more than 25,000 apprentices were taken on. Under the present Government the figure fell to 15,000 last year and the current estimate is no more than 9,200 apprentices for 1983. That represents a 63 per cent. devastating fall since Labour left office. Despite that pathetic attempt by the Government to recruit new apprentices, month by month more than 200 at a time are declared redundant as closures and redundancies escalate around us. The effects on the Principality are more devastating.
There are 6,100 unfilled vacancies in Wales and 180,664 people out of work. It means that 17·5 per cent. of the population is without a job. If the 6,100 vacancies were filled there would be still 174,564 people without a job.
I have taken part in numerous debates on unemployment since the Government took office three and a half years ago. We have highlighted the impact on communities of the closure of pits and factories and the massive demanning in the steel industry. It has been a waste of time, effort and energy to listen to all the promises made to Welsh and Scottish Members and to Members from other regions. The Saatchi and Saatchi campaign during the last election published posters depicting rows of unemployed people and promises that something would be done. What have the Government done? They have trebled the figures, and to rub salt in the wound the Government talk hypocritically in the House about their anxiety and compassion for those whom they have made jobless. However, they do little about curing the scourge and the cancer.
There are 6,000 people out of work in my constituency, and there are 100 jobs available. There is a 60-to-one chance of obtaining work. What hope do those people have for the future? Many of them have been out of work for two to three years. Those aged 50 or over accept that they are destined never to work again.
They are not working for any financial reward now; they are working for the early return of a Labour Government. They know that that is the only answer to their problems, and that Labour is the only party with

Positive plans to solve the unemployment problem. They know that Labour must win if they are to be taken out of the pit of deprivation, degradation and despair.
I do not know why the pollsters do not ask the 3·5 million people who have been pushed out of work how they will vote at the next election. Even if they have been deprived of their dignity by being thrown on the scrapheap, they have a vote still. Who will vote for a Government that caused such massive unemployment and degradation?
Those people still in work are becoming fewer week by week. Whose job is safe with redundancies escalating, factory closures announced daily, company liquidations rising by 35 per cent. in 1982 to a new record of 11,131, which is over 200 a week? If the job is safe now how long will it continue to be safe? If it is essential, how long will it remain so under this Government? Who is left that the Government have not fought? They have fought the Health Service workers, railwaymen, transport workers, miners, steel workers, shipyard workers, shop workers, local government workers, tax inspectors, many others, and now the water industry workers. How many of those people will vote for the Government at the next election?
They have support from the City, the Stock Exchange, the bankers and some of their friends who have been protected by the Government's fiscal and monetary policies, but they are insignificant compared with the millions of people without jobs or who are paid miserly wages and are thus among the 6·5 million people who live on or below the poverty line. That represents one out of every eight British people. The pollsters should contact those people to obtain a more accurate opinion of the Government's handling of this depressing matter.
Where have the jobs been lost that we could and should replace? Social services have been cut to the bone. The list is endless—home helps, meals for the aged, sheltered accommodation, hospitals, hospital services, schools, school meals, sewers, housing, housing repairs, roads and railways. But all that is needed is the opportunity to throw out the Government and change their policies to those of a caring, sharing Government who will alter finances to create jobs, not to destroy them and escalate unemployment. The day of that decision is long overdue and I, with millions of others, await the opportunity with eagerness.

Sir Anthony Meyer: The hon. Member for Ogmore (Mr. Powell) directs our attention at 3.50 am to important matters, and he has treated us to the speech that he will no doubt deliver, with the minimum of corrections, to his management committee when he returns to Ogmore tomorrow.
Of course the problems are grave, but they require altogether more serious consideration than the hon. Gentleman gave them in a highly partisan speech. Every one of us is worried sick about unemployment in the United Kingdom, and the even worse unemployment in Wales. If we are to consider those problems, we must do so in a world context, which was notably absent from the hon. Gentleman's speech. We cannot have the escalation in oil prices that has taken place in recent years, and the transfer of world purchasing power to the oil-producing states, with their restricted use of such funds to create world employment, without immense repercussions on


employment in this and every other industrialisd country. It would be much more helpful if those factors were taken into account by hon. Members on both sides of the House.
I agree with the hon. Gentleman that Government policy towards the steel industry, in obliging the British Steel Corporation to keep open the Ravenscraig works, will—although I understand their reasons and I am sure that the Labour party would have made the same decision—imperil the continuance of steelmaking at Port Talbot and Llanwern. If I believed for one moment that the Government intended to consider seriously the highly theoretical options outlined in the Serpell report, which would involve the closure of most railway lines in Wales, I would be among its most vociferous opponents. But of course the Government will do nothing of the sort. The whole incident shows the great danger of thinking aloud.
Much of the danger in Wales stems not from the Government's policies, but from the conduct of some public sector unions. The outlook for the steel industry in Wales is much grimmer than it would have been but for the senseless strike two years ago. That was not even a strike to save jobs—it was a strike to try to force the nationalised steel industry, which was and is still massively subsidised by the taxpayer, to give a large wage rise to those workers. The result was the only possible one—a derisory wage increase and a massive loss of jobs in the industry as one consumer after another switched to foreign suppliers and did not switch back again to British steel. Mr. Ian MacGregor had to be called in to save what could be saved; and that he could do only by the most drastic and painful surgery.
The picture in the coal industry is superficially a little different. Mr. Arthur Scargill would dearly love to lead the miners into the same type of suicidal strike that took away the jobs of the steel workers. But time after time he has been disowned by the miners he purports to lead; and now he, too, sees his nemesis fast approaching in the shape, I hope, of the redoubtable Mr. MacGregor. But even the diminished Mr. Scargill has so far been able to hold up the process of concentrating resources on the most economic mines, without which there can be no long-term hope of jobs for the Welsh miners. If only the Government will give Mr. MacGregor—if it is to be Mr. MacGregor—rather firmer backing than he got in his efforts to concentrate steel making in the most profitable steel mills, there could be a real future for Welsh coal mining and for new pits using the newest techniques such as the liquefaction of coal at the Point of Ayr.
What the hon. Gentleman really objects to is that the Government are forcing the nationalised industries to live in the real world in the same way that private industry has long had to do. Many of these industries are monopolies, just like the nationalised utilities of water, gas and electricity. If the unions in those industries are to use their industrial power to push up wages higher than in private industry, they will find that the consequences are exactly the same as they would be in private industry—that the bottomless purse of the Exchequer is no longer there to bail out their jobs, that higher wages will mean fewer jobs even if, in the end, that does entail a real reduction in service.
Wales's special misfortune is that she has been for too long too dependent on old-fashioned nationalised industries. With unemployment at its present terrifying level, it is tempting to try to hold on grimly to the jobs we have, even if they are in dying industries. For that reason, I would have found it hard to withhold some sympathy for

the steel workers' strike if it had been a strike to keep jobs. But it was a strike to destroy them and, as such, it was highly successful. Need we go through any more such traumas before we learn the inescapable truth that one cannot fight industrial change; one has to welcome it.
It is not by freezing present industrial patterns, or by banning imports of goods which are being made better and cheaper elsewhere that we will get and keep the jobs we need. If we try to ban the import of foreign motor cars, we may by that very process of banning deal the death blow to the British motor car components industry. It is by beating the foreigner at his own game, by rooting out inefficient work practices on both sides of industry, by refusing to accept wage increases that rob our industry of its competitive edge, by constantly moving up market and into service-based industries that we can win the Welsh jobs that we so desperately need.

The Under-Secretary of State for Wales (Mr. Michael Roberts): I should like, first, to congratulate the hon. Member for Ogmore (Mr. Powell) on being successful in the ballot under the new arrangements for the Bill. I am particularly pleased that he has introduced a debate on the nationalised industries in Wales. These industries are important. No one can be unaffected by their activities, and their performance has a major impact on the economy.
I have listened with interest to the points that have been made. I understand the hon. Gentleman's deep interest in the subject. I understand, too, why he chose to concentrate on some industries rather than on others. What I cannot understand or accept is the argument that we have somehow failed the nationalised industries and that the solution lies in greater subsidy and investment, regardless of viability and the rate of return.
The nationalised industries must be allowed to compete for investment and priority of resources on a se sensible economic and efficiency basis. They must be allowed to compete, but they cannot be shielded from the effects of the market and world conditions. If they are shielded they will lack the right incentives to improve the supply of goods and services while containing the cost of supply and the price to the consumer. Of course, there is a separate area of social obligation. Where grants are required for social purposes, such as British Rail's public service obligation, they have been paid by this Government as by others. British Rail's public services obligation, which stood at £702 million in 1978, has risen in real terms to £926 million in the current year.
The hon. Member and others of his persuasion are keen to put a ring fence around United Kingdom industry, including the nationalised industries. Such artificial barriers just do not work. Let us have a bit more faith in the ability of our nationalised concerns to meet international competition. Certainly if that competition can be shown to be unfairly subsidised there is cause for complaint. But let us not forget the extent to which the nationalised industries in this country are supported. Since external financing limits were introduced in 1976–77, they have averaged nearly £2½ billion a year. The total external financing limit for 1982–83, as set out in the recent public expenditure White Paper, is £2·25 billion. The forecasts for the next three financial years to 1985–86 are £2·67 billion, £2·26 billion and £1·8 billion.
Those figures clearly indicate that the Government have a very substantial commitment to the nationalised industries. The Government have not been starving the nationalised industries of cash. Equally, it is not realistic to demand levels of investment for Wales outside the context of national investment priorities and for projects without a viable basis. The hon. Gentleman has once again demanded immediate substantial investment in a new pit at Margam. I well understand his concern and the arguments in favour of such a project, but the essence of any decision must be whether the NCB assesses it as economically viable at this time.
All the nationalised industries, as I have said, must be exposed to competitive forces. Where and when appropriate there is a role for the private sector to take over in whole or in part. Obviously the hon. Gentleman would like to say that he does not agree, but he wanted to debate the effects of our policies in Wales, so he must not ignore the scope within privatisation for bringing a more effective, responsive and economic service to Welsh consumers. Our determination to pursue this policy is clear. The Telecommunications Bill is now in its Committee stage and we can anticipate the progress that British Telecom will be able to make when freed from the constraints of nationalisation. Wales will benefit along with other parts of the United Kingdom.
I come now to the detail of the hon. Gentleman's remarks. Of course the rundown in the steel industry has had a serious effect on jobs in Wales in recent years, but steel is not a pensioner to be kept going by subsidies. It is an industry which, after facing serious and deep-rooted problems, is being shown the way to recovery and the ability to compete. Years of heavy investment—

Mr. Ray Powell: I refer the Minister to page 95 of the White Paper which sets out the Government's expenditure plans and the capital requirements for the nationalised steel industry. We are talking, not on a Principality basis, but about the British Steel Corporation's capital requirements. The table on page 95 shows that the capital requirement for 1982–83 was £183 million, whereas in 1977–78 it was £502 million. The provision has been reduced from £289 million in 1979–80 to £183 million this year. It is estimated that next year it will be a mere £217 million.

Mr. Roberts: The hon. Gentleman has referred to this issue previously, and I shall deal with it.
As I was saying, steel is not a pensioner to be kept going by subsidies. It is an industry which, after facing serious and deep-rooted problems, is being shown the way to recovery and the ability to compete. Years of heavy investment resulted in far too much steel-making capacity being available. The problems were recognised by the Labour Government. They closed the steel-making works at Ebbw Vale and East Moors, in Cardiff, but although they understood the nature of the problem, they failed to react with the determination that the circumstances required. BSC was left with the major task of closing outdated plants, and both Llanwern and Port Talbot were included in the "slimline" operation that started in 1980. Further demanning continued under BSC's 1981 corporate strategy. One result, as the hon. Member said, was the severe reduction in employment in Welsh steelworks. By the middle of 1982 BSC's manpower in Wales stood at 21,000.
He has looked at only one side of the coin and has failed to mention that those reductions led directly to massive improvements in productivity and eventually in morale. By example, productivity at Port Talbot rose from 6·2 to 4·8 man hours per tonne of liquid steel, and at Llanwern from 4·7 to 4·2 man hours per tonne, between May 1981 and May 1982. Those figures are illustrative of the improving performance at most of the Welsh plants. If the hon. Gentleman wants to take account of our policies in Wales he should consider these figures carefully. We believe that the effect of our policies, together with Mr. MacGregor's management, has produced a genuinely competitive public sector steel industry in Wales, and our improved reputation for productivity stands us in good stead throughout the world.
Of course, BSC still faces substantial difficulties as a result of the continuing effects of world recession. My right hon. Friend the Secretary of State for Industry outlined the problems in his statement to the House on 20 December. He made two crucial points, which I want to repeat now. First, we have made it quite clear to our European partners that we have taken stronger steps to put our house in order, and it is now their turn to do likewise. Secondly, with the prospect of an improvement in steel demand this year we believe that it would be wrong at this time to take irreversible decisions on future capacity. Clearly, this leaves a degree of uncertainty, but the hard-won performance of Welsh plants should stand them in very good stead when an increase in business comes.
As to investment prospects, we intend to make an announcement about Port Talbot's request for a £135 million hot strip mill modernisation scheme as soon as possible. The Government's record of investment in the Welsh steel industry is very good. The three years from 1979–80 have seen a total investment of over £240 million. This includes some important schemes such as the continuous casting plant and the new Morfa coke ovens at Port Talbot, a new coil inspection line at Llanwern and the updating of the five-stand cold mills at the three tinplate works of Ebbw Vale, Trostre and Velindre.
Predictably, the hon. Gentleman's speech contained much about the coal industry. For our part, just as my right hon. Friend the Secretary of State has made known his strong desire to see a viable Welsh steel industry within a viable United Kingdom steel industry, so too, do we want a strong and viable Welsh coal industry within a national context. But clearly there are major differences between the hon. Gentleman's proposals for a large, production-orientated, massively subsidised and inherently vulnerable industry and the Government's plans for a cost-effective industry in line with the market demand for coal.
The hon. Gentleman knows very well that all pits eventually reach the stage where they can no longer be supported. Why else were 46 Welsh pits closed between 1960 and 1979? The economic realities of an extractive industry do not change from one Administration to another. I understand why the hon. Gentleman calls for huge new investment, but he must understand that the South Wales coalfield is being supported with very substantial amounts of taxpayers' money just to cover deep mine losses—£95·9 million last year and possibly over £120 million this year. Investment funds have been made available to the NCB for those projects which it believes to be economically sound.
In the two years to 1981–82, capital investments in the South Wales coalfield totalled over £75 million. Investment this year will be at about the same annual rate. The hon. Gentleman should remember that these levels of capital investment must be seen together with the support given to cover losses. He will remember, no doubt, that Oakdale, for example, in south Wales is receiving £22·3 million for reorganisation and access to new reserves. In North Wales, at Point of Ayr—this was mentioned by my hon. Friend the Member for Flint, West (Sir A. Meyer)—a new drift is being developed at a cost of about £16 million. At Lady Windsor, Abercynon, a new skip winding scheme represents an investment of £5 million. At Trelewis, a new drift mine represents £9·8 million. At Merthyr Vale the development of new reserves means £3·5 million. At Marine, £2·5 million is being invested in new winding gear. At Abernant £0·7 million will go on underground manriding. AT Blaenant, new service blending plant will amount to £0·5 million. At St. John's, improved coal handling facilities represent £0·4 million. Therefore, we are investing in our coalmines in South Wales.
Earlier I briefly mentioned the Margam project. Because of the hon. Gentleman's obvious interest—he has, I know, raised the subject often in recent years—I want to say a few more words about it. I have outlined the approach that the NCB takes on investment decisions—and those decisions, incidentally, are a matter for the board and not for the Government. My right hon. Friend the Secretary of State has had discussions on a number of occasions with the chairman of the NCB about Margam. We have therefore kept in touch with the prospects for Margam and we understand why the NCB does not wish to proceed at this time.
As the hon. Gentleman will know, the NCB has undertaken a thorough survey at Margam. This has established that the coal seams lie very deep and therefore to mine here would inevitably be a high-cost operation. At the same time, the NCB has to pay regard to its future markets and that is as true for Margam as for any other prospect. But the coke market has declined in recent years and a market for Margam's coal is thus by no means secure. The point is that the NCB could proceed with the Margam project only if the costs were right, if the market were right and if it made sense within its overall investment plans. The hon. Gentleman must consider those three points.
No coalfield can expect an automatic right to an arbitrary level of investment. That investment must be relevant to the industry as a whole and medium-term market expectations. During his interview with the South Wales Echo last week, the Secretary of State was asked about investment. He said
It really would be odd and very eccentric if investment was distributed proportionately, because the simple fact of the matter is that the Welsh coalfield is making a huge chunk of the NCB's losses.
He went on to say:
I think the pattern in Wales is going to be that there is going to have to be continual closure of loss-making pits for which there isn't a future and relevant, worthwhile expenditure in the pits which have a future.
That means that the NCB must, under the agreed arrangements, continue to assess very carefully the future of pits which are serious lossmakers and show no prospect of recovery. At the same time, it will be looking at the case for investment. Several pits have received valuable funds

recently and important schemes are in operation, which I have mentioned the most important. More will follow, and other important developments are in hand.
I well remember the hon. Gentleman and his hon. Friends insisting that the NCB should invest in the Ancit process in 1979. At that time the process had not been fully tested and it would have required a substantial subsidy from the Government. A decision to proceed then would have been wrong, but I hope, that the hon. Gentleman has taken note that the NCB is now ready in principle lo go ahead with the scheme on a properly secured technical and financial basis. The announcement last Thursday will be very welcome to the work force and the inhabitants of that part of the Cynon valley. I recognise the pollution that has been caused by the phurnacite plant there.
I hope, too, in case the hon. Gentleman still doubts our commitment to the future of the coal industry, that he remembers the support that is being given to the NCB's proposals for a coal liquefaction pilot plant at Point of Ayr. We all hope that this investment will lead to major new markets for coal in future generations.
The Government hope that the rail network will continue on a healthy and efficient basis. My hon. Friend the Member for Flint, West raised this matter. It is also the Government's duty to ensure that the taxpayer gets value for money. It is unwise of the hon. Member for Ogmore or anyone else to accuse the Government of failing to support the railways. In fact, British Rail is absorbing large amounts of public finance—about £926 million this year alone. We have reached the stage where we can no longer continue in the present inefficient way.
Last Thursday my right hon. Friend the Secretary of State for Transport made clear where the responsibility lies for the current state of affairs on the railways. At the same time, he welcomed the Serpell report. My right hon. Friend explained that the network options set out in the report were not closure plans. The report, however, did raise questions as to what is the most cost-effective way of meeting transport needs. The Government's intention is to consider the long-term future of the railways in the light of all the facts and the public debate following this report.
Hon. Members can be assured that in all this the Secretary of State and I will look very carefully at the needs of Wales, particularly in the rural areas. However, as the Secretary of State for Transport explained to the House, the taxpayers' contribution to British Rail has risen steadily in real terms over the past five years. For example the public service obligation contribution which enables British Rail to maintain the network in Wales and elsewhere, at constant 1982 prices, has risen considerably. The figures are: £664 million in 1977, £702 million in 1978, £768 million in 1979, £774 million in 1980, £891 million in 1981 and £926 million in the current year. In real terms, there has clearly been a steady climb in Government social support for the passenger railway. We have now reached the point where the value of our support exceeds the total revenue from fare-paying passengers.
British Rail's investment picture in Wales is by no means gloomy. For example, in May last year a new HST service linking south Wales with Birmingham and the north-east was introduced and, as recently as January, the service was strengthened by an additonal HST in each direction. The main line stations in south Wales are the subject of a major refurbishment programme, with work in hand at Cardiff and with work at Swansea planned. A


new freight line to service Coed Bach washery is at an advanced state of planning and since we came to office the Welsh Office has grant-aided the provision of freight handling facilities and wagons in Anglesey and south Wales. Several more schemes of a substantial nature are currently in the pipeline and these should help to preserve rail freight carryings, while at the same time protecting the local environment.
The hon. Member for Ogmore, not for the first time, raised the issue of unemployment, especially as it affects south Wales. I wish that he had the generosity of mind to appreciate that concern is not limited to himself or to the Opposition. He selected demanning in the steel industry and the continued rundown of the coal industry as the two important escalaters of unemployment.
I have already mentioned the fact that it was a Labour Government who closed East Moors in Cardiff and Ebbw Vale. The years between 1964 and 1970 were a peak period in which 39 pit closures occurred in south Wales, with 17,754 miners losing their jobs. I do not blame the Labour Government. It would be possible to conduct a more realistic appraisal of the problem if we stopped pretending that it was an act of the Government that caused every economic catastrophe in south Wales.
Few people, are prepared to maintain that the steel industry would be surviving today at Llanwern and Port Talbot if essential demanning had not taken place. Most steel industry experts ask why the nettle was not grasped earlier to ensure that the industry became more competitive and able to secure international and domestic markets.
The hon. Gentleman asked what the Government were doing about unemployment. We are trying to make the nationalised industries highly competitive and efficient. Only in that form can they survive. We are trying to build an infrastructure in north and south Wales that will attract new industries. We are building roads and factories at a record level. There is every evidence to suggest that a number of important new technology industries have come into south Wales, attracted by the infrastructure that we have provided. Mitel, AB Electronics and Inmos are recruiting labour.
I recognise that, at a time of world economic recession, we are not making up completely for the ground that has inevitably been lost through coal closures and the demanning of the steel industry. These were not the acts of a Tory Government alone. Governments of both political parties were inevitably engaged in them. If only the hon. Gentleman would see that people who do not share his political ideology and who take a different view of society share with him concern for the unemployed we would be much nearer a solution to some of the problems in south Wales.

Orders of the Day — Operation Major (Oxford)

Mr. Andrew F. Bennett: I am pleased, even at this hour, to have the opportunity to raise the issue of who really were the guilty people in Operation Major at Oxford on 2 September last year. Does the Minister accept that the book "Poor Law—the mass arrest of homeless claimants in Oxford" by Ros Franey, an account of Operation Major published recently by CHAR, the Campaign for Single Homeless People, the Child Poverty Action Group, the Claimants' Defence Committee, the National Association of Probation Officers and the National Council for Civil Liberties, is basically a fair account of what happened? I hope that the Minister will make it clear that he excepts most of the account.
It is clear to me that those who were convicted by the courts in Oxford were very small villains, if villains at all, compared with the real criminals who so far have got away with their crimes. Who are those guilty people? At this stage, one can only speculate. Are they really Ministers of the Crown, supplementary benefit and fraud officers or controllers in the Department of Health and Social Security, the police, the magistrates clerks, the magistrates themselves, or some Oxford landlord? The only way to find out the truth and to try to clear the good name of most people involved is for the Minister to institute a full public inquiry.
Let me try to follow the train of events as they have been told to me and as I go along pose some questions to the Minister. When did the Department of Health and Social Security first believe that there might be a problem of illegal payments in Oxford to people with no fixed home? Was it as early as February 1982? How soon did it involve the police? Was that April 1982? Who gave the authority to go on making possibly illegal payments from February or April until September 1982? Were Ministers informed? If not, were they asked for authority at that early stage to make those payments? Why would such authority be necessary? As the House knows, benefit is paid out weekly, based on a weekly claim. When the claim is made, particularly for people in this type of accommodation, it is made on a regular basis, The benefit officer must be satisfied that it is a genuine claim. If he is not so satisfied, he can ask for extra evidence and can check up on the claimant. He can even refuse benefit and force the claimant to appeal. Certainly from my experience, and I am sure that of other hon. Members, the benefit officers regularly make checks and insist on extra information.
Often, when people use bed and breakfast accommodation, benefit is paid out in vouchers, not cash, to try to avoid any possibility of fraud and to ensure that the claims are genuine. It is interesting to note that in the incident in Oxford, the very day after the mass arrests, a new system was introduced there to eliminate the possibility of the fraud system or anything like it being used again.
Once one raises the question of possible fraud, no benefit officer could be certain about the claims that he was paying out unless he visited the addresses and made other checks on the individual claimants. Had he done so, Operation Major could not have gone ahead. I know that the Oxford offices were short of staff, but how can a benefit officer go on knowingly paying out a few


fraudulent claims for over six months without someone authorising it? Who authorised it? Was it the Minister? Was the Minister told at this stage? Why were benefit officers authorised to go on paying out what they thought might be fraudulent claims for up to six months without making the normal checks and carrying out the normal safeguards, which, of course, would have made Operation Major impossible?
If the problem was fraudulent claims, they could have been stopped in February or, at the latest, in April by the police or by the DHSS fraud squad visiting the lodging houses. Over three or four weeks, all the possible fraud could have been stopped. Oxford could have gone over to paying out the money in vouchers instead of in cash. Oxford could have introduced in February the scheme that they introduced in early September and which appears to have stopped the frauds.
Someone must have decided not to act. Why? The only possible explanation is that the authorities believed that other criminals were involved—not claimants; possibly the landlords. Perhaps the police believed that someone in the DHSS benefit offices was acting illegally. If that was the explanation why on earth did the Department go on paying out benefit for six months?
There is another possible explanation. Perhaps a publicity-seeking official in the DHSS—a regional controller for supplementary benefit or a regional fraud officer—decided to obtain publicity. There are other possible explanations. Did the DHSS and the police allow illegal payments to be made for six months on the Minister's instructions? Was it officials or the Minister who wanted a big fraud success?
The right hon. Member for Daventry (Mr. Prentice), when he was Minister, as well as the present Minister, have made some wild claims about the level of fraud in supplementary benefit payments. Did Ministers issue an instruction to the supplementary benefit officials or the fraud squad to look out for a big operation? Did the Minister believe that Operation Major was the big one? Was he planning a series of operations? If so, why were the others not carried out? Was there not sufficient evidence? Was Operation Major at Oxford allowed to go on because it was the first and the only one that might, with luck, have met the Minister's original plan and instructions? Were the others stopped because Operation Major turned into a fiasco?
Was Operation Major at Oxford authorised by the Minister, or was it part of some nationwide scheme authorised by the Minister of which Operation Major was the only part to be publicised?
I hope that the Minister will make a much clearer statement to the House than he made in his prevaricating letter to The Guardian last Friday about ministerial involvement.
There are three possible explanations of what Ministers knew and authorised. The Minister ought to tell the House exactly what happened and clear up possible misunderstandings.
Was it a Thomas à Becket situation? Did the Minister make it clear that he wanted dramatic fraud action so some officials set up Operation Major acting on a general ministerial instruction but never discussed the details with him? More than £20,000 was paid out to hire the school. Innocent people were held and denied their legal rights. Were Ministers told only on the day itself, either the morning or the afternoon after the event?
The Minister ought to make it clear to the House today how much the Secretary of State was told, when he was told, how much the Minister himself knew about it and how much the Under-Secretary of State, the hon. Member for Braintree (Mr. Newton), was actually told? Was it true that he found out only when he was asked to comment by the Press some time in the afternoon? Is it true that the senior permanent officials in the Department first heard about it from the media after it had taken place? That is one possible account—over-zealous officials acing off their own bat without the Minister knowing anything about it, beyond a general instruction to try to obtain plenty of publicity about certain allegations of fraud.
Another possible explanation is that the regional directors planned the whole scheme with the police and did not tell the Minister the details until it was all over, so that they were not really acting on any instruction from the Minister.
The third possibility is that Ministers knew all about the operation, were fully consulted from the planning stage onwards, and gave their full consent.
The Minister owes it to the House and to the country to state exactly what his involvement was. He may reply to some of my questions by saying that he cannot answer for the police or the magistrates, but he should certainly be able to give far clearer answers about his own responsibility and knowledge than he gave in his letter to The Guardian on Friday.
I return to the real question. Only the possibility that landlords or supplementary benefit officials might be involved in crime could have justified the failure to take action in February or April to stop the fraud.
If the motive was publicity, can the Minister really justify aiding and abetting fraud for six months merely to obtain publicity? If it took officials as long as that to act because they were holding off to obtain publicity or if the Minister instructed them to do that, it is a disgrace, the officials should be sacked and the Minister should resign. No one can justify encouraging fraud for that length of time merely to obtain publicity.
Only the belief that the police and the Department were on to something big could have justified the silencing of the Oxford Mail, if indeed that can be justified at all. The Oxford Mail stumbled on the story in July. The police said that they were after the landlords. Was that true? The Minister should at least be able to answer that. If it was not true and the police wished only to catch claimants who could have been stopped in February or at the latest in April, how could they possibly justify lying to the Oxford Mail?
If the police and DHSS fraud officials went along with the inquiry and found that no Mr. Big existed or if they accidentally tipped them off, why did they not call the whole thing off? Did the operation go ahead as a cover-up to justify the police and the DHSS fraud officials spending so long on it, or was it only at the last minute that some police officer or DHSS fraud official deliberately or accidentally tipped off the real criminals? Did the real criminals actually get away with it?
The police and the DHSS officials clearly acted illegally in selecting claimants to go to a specially opened benefit office to collect benefit on 26 April. Those benefits could have been paid out legally only if the officer paying them out believed the claimants to be genuinely entitled to them. It was clear, however, that in selecting some claimants to go to the new office the DHSS did not believe


that they were all genuine. DHSS officials must have suspected that some of those people were not genuine. Therefore, as part of their duty when they parted with the money, they should have checked those claimants.
The first question for a public inquiry is therefore this. When did the DHSS and the police first suspect fraud and why did they not stop it there and then? Did they believe that there were other criminals—landlords or DHSS officials—and, if so, when did they find out that no one else was involved? Did the real criminals that the operation was designed to catch manage to escape? Was the prosecution of those who appeared in court designed to cover up the abject failure of the operation to achieve its real aim? How did Ministers know about it? If they were not told, why were they not told? Who authorised the paying out of some benefits for six months when the claims were believed to be fraudulent?
At this stage, the question is whether the police were misled by the DHSS. Did officials at the Department mislead the police? Did they give the impression to police officers that £1·5 million was involved? Were the police shocked and ashamed when they realised just how little was at stake? The DHSS does not seem to have explained to the police that a person is entitled to claim at the lodgings rate even if he does not stay in those lodgings for one night a week.
On that basis, the police advised people not in the lodgings on the night of the 1st to plead guilty because they were missing from those lodgings for one night. However, when the regulations were explained, it was clear that those people were not guilty. If the DHSS failed to inform or misled the police about that element in the regulations, how much did the DHSS really tell the police?
Did the senior police officials decide that £1·5 million was involved, in which case why did the DHSS not make it clear that such a sum was not involved? Was Detective Superintendent George Hedges misled by the DHSS, or did he work out the figure himself?
One of the lodging houses in Oxford run by Jeremiah Cronin was raided some time between 6 and 7 o'clock in the morning. What was on the search warrant? It is a small point, but it would help us understand what this was really all about. Why a search at all? If the landlord was supposed to be helping the police, as it now appears from all the statements produced, there could have been much simpler ways of acting. The police could have obtained the co-operation of the landlord to keep a check on those who went in on the night of the 1st and those who left on the morning of the 2nd. Those records could have been kept for three mornings as clear evidence that people were not entitled to the benefit they claimed.
If the landlord was not helping the police, did the raid tip him off and ensure that he or someone working in his lodging house were able to escape possible prosecution?
The Minister must say more about what happened at the special DHSS office, the setting up of which cost a lot of money. Why were innocent people detained? Why were they not allowed to make phone calls? Was it just an accident that no one thought about the rights of individuals to make phone calls? Was it impossible to install at short notice sufficient telephones, or was it a deliberate attempt to make sure that people could not communicate with others outside? Why were people treated in that way? If it was to prevent them from communicating with people

outside, it is just about possible to justify that up to 12 o'clock in the morning, yet people were denied that opportunity for another six or seven hours.
Some time around 12 o'clock, the Oxford Mail started printing. It contained pretty full coverage, and there was coverage in most of the media from that point on. In fact, the police seemed keen to ensure that their version received good publicity.
The limited account of police arrests given in "Poor Law" must make the vast majority of the police force ashamed of the Thames Valley senior police officers, who deliberately set up an operation knowing that they would force many of their junior officers to break so many rules.
Whom did the police intend to catch on 2 September? Why did the police not allow phone calls after 1 o'clock? Why did they not allow claimants access to solicitors or probation officers to discuss the preparation of a defence which many of them had?
The House will have seen the bleatings in the press from the Thames valley assistant chief constable, Mr. Wyn Jones, complaining that The Guardian and the publication "Poor Law" infringed the sub judice rules. As we are allowed to debate the matter in the House, there can be no question of those rules being infringed. It is a pretty weak argument to put forward. He asked for the whole matter to be delayed and suggested that questions should not be asked. That is an odd interpretation. After all, it was the police who called the press conference. They wanted to draw attention to the event.
What was the point of the press conference and the thrust of the stories that followed it? One assumes that the police press officer did not make a complete mess of the matter and did not give wholly the wrong story. The police wanted to magnify and exaggerate the extent of the possible fraud. The press conference produced a figure of £1·5 million at stake—not the £60,000 which is all that even the Minister could suggest was at stake. The press conference was designed to win headlines and to influence the magistrates and convince them to act hastily and to refuse bail because big crime was involved.
It is odd that the police set out to pervert the course of justice with a press conference. They encouraged and pressurised magistrates to take a harsh line and to impose harsh sentences because it was a big event. Yet they now object to the publication "Poor Law", the asking of questions and the demanding of answers.
The senior chief officers in the Thames valley have much to conceal—either the real criminals got away or the police acted like bullies and thugs, using ridiculous measures to stop small crimes that could have been stopped six months earlier with normal DHSS procedures. We understand that the police carefully made a video of their proceedings while they held people in the bogus DHSS office. Did the Minister ask to see that video? I understand that the public cannot see it for various reasons. The Minister should at least have ensured that he saw it. There should be some arrangement for Members of Parliament to see it. If there is a public inquiry into the matter, the video should be shown then.
There are major questions to be asked about the use of video in such circumstances. The Home Secretary issued clear guidelines to police forces. The use of video on this occasion does not appear to come within them. The other suspicion is that the Thames valley police wanted to use


it as a training film, but that would be an illegal use of it as I understand the rules. Certainly Members of Parliament and others cannot see it.
If the police broke many rules, so too did the magistrates. I understand that the Oxford bench is, in normal circumstances, a conscientious bench. Why did it not ensure that all defendants had an opportunity to discuss their problems with a solicitor? Why did it not allow bail while the bail hostels or the lodging houses accepted for bail purposes had vacancies? What evidence did it demand from the police in each case against the presumption of the Bail Act 1976 that everyone is entitled to bail unless evidence shows why it cannot be allowed?
As I understand it, the police did not put up evidence in each case. What will the Government do about producing free pardons for those people who were pressurised into pleading guilty because of their ignorance? Even worse, the police were ignorant. We now understand that the police advised anyone who was not at the address that they claimed to be living at for one night that they had broken the law, yet we knew from later cases when people pleaded not guilty that if they were missing from that address on only one night they had not committed an offence.
Why were the magistrates' clerks involved in such breaches of the rights of the accused? Why have the JPs who sat in the courts not been asked to resign or offered to resign? It is a fundamental part of our system of justice that someone who is accused should have the right to consult a solicitor to prepare a defence. It is the duty of the magistrates and their clerks to ensure that that happens. According to the book "Poor Law", attempts by the accused to consult solicitors were repeatedly frustrated by the officials of the court.
We must examine the balance sheet of the operation. We are now told that £180,546 was spent on trying to stop a fraud of about £60,000—if we are generous to the Government. That is about 4 per cent. of what the police and DHSS officials suggested was involved at the original press conference. Most of that money could have been saved six months earlier through normal DHSS procedures. Why was that amount of money spent? What was the justification for it? The Minister ought to tell the House.
I know that the Minister will not accept responsibility for the media, but he must tell the House how all of the media arrived at the claim that a £1·5 million fraud was at stake. Everyone now realises that that could not possibly be argued. A claimant would have to claim for three or four years to get anything like that sum. The media themselves must ask what justification there was for the Oxford Mail going along with the cover-up. Was it conned? Did the police lie to it?
The media must also question themselves about the headlines that they published. What were they based on? Did they check the story? Why did they produce the information that was given at the press conference? Is there just a possibility, as sometimes happens when journalists attend a press conference, that they all stood around afterwards, discussed the story and came to a consensus? The headlines in the papers the next morning were extremely similar. They said such things as "£1·5 million fiddle smashed" and "286 held in dole fiddle". They were utterly wrong, as few people involved were unemployment benefit claimants. Why did the media not get the real headlines such as, "Real criminals escape:

massive DHSS and police raid goes wrong" and 'Minister never told about Operation Major" or "Chief constable justifies ill-treatment of epileptics and mentally handicapped: JPs and magistrates' clerks ought to be in the dock"?
It is also interesting that, when one or two people started asking questions, only a small proportion of the press decided that it was worth going back over the headlines and stories of 2 September, and considered that a different slant on the story was necessary.
I do not want to spend all my time going back over the incidents of Operation Major, because there are many lessons that must be learnt from it. Of course I want assurances from the Minister that it will never happen again, but all hon. Members share some responsibility. The present Government are responsible and previous Governments must take much of the blame.
Probably the real crime is that we still cannot provide decent accommodation for single homeless people either in Oxford or in most of the towns and cities in the country. In many ways the conditions of the single homeless have altered little since George Orwell described the spikes in "Down and Out in Paris and London" 50 years ago.
If there was decent accommodation at a reasonable price, most of the problems of the single homeless would not exist. Landlords could not exploit common lodging houses. We should give the same rights to the single homeless as for parents with children, for example the right to have local authority housing. My hon. Friend the Member for St. Pancras, North (Mr. Stallard) will introduce a private Member's Bill on behalf of CHAR. I hope that the Minister will see that it goes through and that we give the right to decent accommodation to the single homeless. Those people would then have accommodation, and there would be no difficulty in getting benefit. It should be a decent level of benefit, adequate to pay for the accommodation.
As long as we have such lodging houses in Oxford it is clear that the Department has a duty to see that they are regularly inspected and come up to minimum standards. The local authority should inspect them to see that they are meeting the standards required by the fire regulations and that they are the sort of places on which we should spend public money and where people should be allowed to stay.
There are many lessons for the police. They have to make sure that the law is administered fairly and that there is not one law for the well-off—those who can speak up for themselves—and another for the disadvantaged, the sick, the mentally handicapped, and the disabled. The police give people who are accused of offences their rights. There is access to the telephone, the solicitor and bail, unless there is clear evidence that the person will commit some other crime that will seriously endanger society.
At Oxford, Chief Constable Imbert said that he had many copies of people's rights printed on posters on the walls of the fake DHSS office. That shows the chief constable's attitude. One would have thought that he would have weighed up for a minute the fact that some of the people who were likely to be at the office probably could not read, or found reading difficult. They would find it difficult to understand such a poster. It is not an unreasonable assumption that in a group of homeless people, quite a few would be unable to read and would find it difficult to understand what the notices meant. I suggest that the chief constable should change many of his


attitudes the next time he is thinking of setting up a mass arrest and should make sure that people are told their rights.
The Oxford bench has to do some careful thinking. It is difficult for magistrates and magistrates' clerks not to be bamboozled or bemused by the police, particularly if they issue a statement at a press conference in which they suggest that many people have been breaking the law and that there is a need for mass court appearances. They must make sure that even in those circumstances people get a fair trial. The measure of justice is whether it is applied all the time, consistently, and not sometimes.
We must make sure that we change our attitudes. We should condemn everyone who cheats the state, whether through social security fraud, VAT fraud or income tax fraud. We must make it clear that the emphasis and expenditure of state resources should be on detecting the big frauds first—for example, tax frauds. In matters relating to the DHSS we should not, perhaps, go for the frauds but should design and run the system so that it cannot be defrauded. In Operation Major, why did not the Department emphasise the need to prevent fraud? Why did it not stop the fraud as soon as it had an inkling of it six months previously? The Department should have been preventing such frauds not seeking publicity.
I hope that the Minister will give the House a great deal of information. However, I believe that the only way that the air can be cleared and the bitter taste can be removed from the mouths of the people who read the book "Poor Law" or who have studied other accounts of what went on is to have a full public inquiry in which the Department, its officials and the police can state their case and from which we can see who were the guilty people.

5 am

The Minister for Social Security (Mr. Hugh Rossi): The hon. Member for Stockport, North (Mr. Bennett) has seen fit to launch an attack upon a police operation with which my Department co-operated and which was designed to stop a serious and rapidly growing fraud against the social security system in Oxford.
The hon. Gentleman has based his attack upon the contents of a recent publication which the assistant chief constable of the Thames Valley police described in a letter to The Guardian on 4 February as
inaccurate, biased and totally selective.
The letter also said:
The Thames Valley police have been constrained from public comment because of a desire not to prejudice the fair trial of those still to appear at court … Only when all prosecutions have been completed will the facts about Operation Major be available.
I shall leave to the chief constable of the Thames Valley police the matters which are his responsibility and not that of any Minister whether within my own or any other Department—the police operation to secure the arrest and detention of those people involved. Nor can I answer for the magistrates in the exercise of their judicial discretion on bail or the custodial sentences which they saw fit to impose.
However, I answer for the DHSS and the part played by my officials in the matter. Before I enter into a discussion of the details of the case, I remind the hon. Gentleman, and those who have shown an interest in the matter outside the House, that my Department is

responsible for the payment of a sum in excess of £30 billion in cash benefits in a year. It makes literally millions of payments, some of them substantial, through local offices, across post office counters or by post. There are enormous opportunities for the money to go into the wrong hands. It is, therefore, essential that strict control is kept and every possible effort made to detect and prevent fraud and abuse. I make no apology for that. Indeed, I should regard it as the height of irresponsibility and a breach of duty to the taxpayer, and the entire working population which produces the money spent by my Department, if that were not the case.
In 1980–81, 121,695 cases of fraud were investigated. They led to 30,116 prosecutions. In 1981–82 there were 136,307 investigations into fraud, resulting in 25,654 prosecutions. Convictions were secured in about 97 per cent. of the cases prosecuted.
The hon. Gentleman will note that those figures show that the number of prosecutions in relation to the number of investigations has fallen from one in four to one in five during those two years. That is the result of deliberate policy on my part. I have taken the view that it is far more important and humane to check the abuse of the system when it is detected and to try to recover the money than to mount expensive prosecutions and to drag those individuals through the courts. The exceptions to that rule, where prosecutions should be pursued, are when substantial sums are involved, or the fraud perpetrated is essentially grave, or where a growing practice must be demonstrably brought to a halt.
I have been criticised severely for my policy, especially that of specialist claims control, by many of those whose voices have been raised against Operation Major. The argument against me is that it is wrong to deny people accused the opportunity to clear themselves before a court. My reply—that most people would prefer to be given the opportunity to restore the money rather than to face a public trial—has been brushed aside. Now those critics complain that arrests have been made and prosecutions mounted and that, so the argument goes, those poor unfortunate people should be left alone and that the costs of dealing with them outweigh the money wrongfully taken. Those critics cannot have it both ways. The House will forgive me if I say that there is a strong element of hypocrisy in the way that they seem to back contradictory arguments when it suits them. One must wonder about their real motives.
The specific circumstances of Operation Major are that, early in July 1982, the Oxford local office found that claims for benefit were being made by about 200 people on the basis that they were living at one of two Oxford addresses and paying charges of £42 a week for bed and breakfast. Those claims attracted supplementary benefit of £67·20 a week. The local office noted that there had been a dramatic build-up of those claims during May and June. They also involved—I mention this because the hon. Gentleman made the point—the abuse of board and lodging vouchers.
The officials at Oxford knew that the premises in question could house only about 90 people, so they alerted the regional fraud section. Schedules were set up immediately to keep a close check on the number of claims from those purporting to live at the two addresses. There was a high turnover among the claimants, and the landlords did not keep accurate records of their tenants. That made it very difficult to keep an accurate check of


the continued residence of claimants, but it soon became obvious that some positive action was necessary to counter fraud that had clearly grown to substantial proportions.
The build-up of claims was such that there was reason to believe that the supplementary benefit scheme was being manipulated in an organised way. By the time the operation was launched on 2 September, the numbers involved had grown to almost 300, but because of the itinerant nature of the individuals, and because officials were dealing with a shifting population, it was difficult to pin-point at any one time which of the 200 to 300 people claiming to live at those addresses were the 90 for whom there was room.

Mr. Andrew F. Bennett: Is it being suggested that it became clear to the Oxford office that the problem existed in July? As I understand it, the Minister's officials in discussions earlier this week said that it first came to their attention in February and the police were first involved in about April. The Minister, having said that they first noticed it in July, then said that it appeared that there had been a big build-up in May and June. When did the Department start talking to the police? Was that in July?

Mr. Rossi: I shall come to that at once. At about the time the regional office fraud section was informed by the local office of its suspicions—

Mr. Bennett: In July?

Mr. Rossi: —because of what was happening in May and June, the police visited the local office saying that a murder inquiry had highlighted that a problem of fraud existed in respect of these addresses. The local office then explained to the police that it had already set in train inquiries and had informed the regional fraud section, but from that point onwards the matter became a joint operation—

Mr. Bennett: In July?

Mr. Rossi: That was at the end of June. The hon. Gentleman will appreciate that there was good sense in a joint operation between my officials and the police, for reasons that I have already given. The vast majority of the people claiming to live in the same two houses were itinerants and it was expected that few, if any, would be able to give an alternative address to those used in connection with fraudulent claims. The problems therefore were how to deal with large numbers and how to prevent claimants from absconding.
The police have the resources and the powers to overcome both these problems. The matter was referred to them at the early stage to which I referred. Any attempt to deal with the fraud in a piecemeal fashion would have resulted in many of the offenders avoiding detection. There is also a distinct advantage in seeking police assistance in such a case because where there has been an arrest the case can be brought before the courts quickly, even on the same day, as was done in this case. Everybody arrested and charged was brought before the magistrate that same day. Again, cases can be dispensed with quickly on the first hearing before the magistrates' court. By contrast, departmental fraud procedure involves the issue of a summons, which can lead to a large lapse of time between discovery of the offence and its final disposal in court, with the impending prosecution hanging over the person involved.

Mr. Bennett: Do I take it that at this stage of the joint operation between the Minister's Department and the police the minister or one of his ministerial colleagues was told about it?

Mr. Rossi: I shall come to the question of ministerial knowledge and instructions in due course. I shall deal with the events chronologically.
The DHSS staff co-operated with the police in setting up the operation and in interviewing the suspects when they came into the temporary office to make their claims, but action taken thereafter was a matter entirely for the police.
As a result of the operation, 283 people were arrested, 179 of whom were subsequently charged and remanded by the courts. In the event, 160 of those charged pleaded guilty to obtaining benefit fraudulently and 15 pleaded not guilty. Four cases are still outstanding. There were 165 convictions and 10 acquittals. All those who were convicted received terms of imprisonment ranging from seven to 180 days. Of those convicted only 20 had no previous convictions.

Mr. Bennett: Will the Minister make it clear whether the 20 had previous convictions for supplementary benefit fraud or for other offences?

Mr. Rossi: I believe that the nature of the previous convictions varied from individual to individual. I cannot give the hon. Gentleman the specific details. These matters were all mentioned in open court.
Of the four cases remaining to be dealt with by the courts, two of the defendants—Jones and Carron—have been charged with conspiracy. Jones has pleaded guilty, and Carron has pleaded not guilty and has been committed for trial. They are facing much more serious charges than the other defendants for whom the hon. Gentleman showed the greatest concern. He will appreciate that I cannot comment upon a case which has still to come before the courts.
The hon. Gentleman has joined in the criticisms of the decision to set up a special office. Those in charge of the operations took the view that it was necessary to interview all those concerned on the same day. This could not have been possible by using either the local social security or the unemployment benefit offices. Therefore, it was decided to open separate premises for this purpose. This enabled all claimants using the suspect address to he brought together, at the same time avoiding inconveniencing other claimants attending the office on legitimate business. These temporary premises were school premises and they have been used subsequently as an emergency office during the strike in the Oxford area office.
The hon. Gentleman has made a great deal of the fact that the news media estimated the extent of the fraud at being anything up to £l½ million. I can assure the House that neither this figure nor anything like it emanated from my Department. I can only assume that the amounts quoted were the result of speculation. A press conference was held by the Thames valley police on the day of the operation. That is a matter for them. At the conference a police spokesman said that the fraud involved was of a substantial amount. When pressed he said that it ran into thousands rather than hundreds of pounds. At no time was any other reference made to the amount of benefit


involved. I have that information on the authority of my regional information officer, who sat at the back of the police press conference as an observer.
I and other Ministers have subsequently made it clear on a number of occasions that had the situation been allowed to continue for a full year the wrongful claims would have amounted to £450,000. The Department incurred costs of £21,000 in mounting the operation and I am informed that police costs amounted to £15,000 over and above normal duty costs. The hon. Gentleman has asked whether I or my right hon. Friend the Secretary of State gave instructions for a great spectacular because we were seeking some large publicity gimmick. We did no such thing, and would do no such thing.
As I had made plain in my letter to The Guardian, which the hon. Gentleman has seen fit to denigrate, Ministers do not direct investigations into individual cases; nor do they decide who should be prosecuted. It is right that that should be the case. If Ministers were to make themselves responsible for each of the 130,000 investigations into fraud that take place every year—assuming that it was physically possible for them to do that—there would be questions as to whether there might be some political bias in the way that they directed their investigations against particular individuals, or particular groups of individuals.
How many more questions would be asked if Ministers directed or instructed who the individuals should be that are or are not prosecuted? Therefore, Ministers—I speak not only for myself but for my predecessors—have nothing to do with these matters. The decisions are taken by those officials who are charged with the responsibility for ensuring that the overall policy is carried out. That overall policy is to detect and prevent fraud whenever possible.

Mr. Bennett: It is possible that the Minister is coming to my point, but I should like to make the matter clear. When did he know about the operation, and when did his ministerial colleagues know about it, particularly in view of the decision to spend almost £20,000 on office accommodation? If it had been spent in other ways, that money could have prevented the fraud, even if the Minister knew about it only in July, by having extra accommodation available and extra staff to do the checking up. That would have meant preventing and not catching.

Mr. Rossi: I knew about the matter for the first time on about 21 or 22 September, when I returned from leave. I knew nothing about the operation before I went away on leave. A note was prepared by officials for Ministers a week or so before 2 September. That was simply to advise them that a large-scale operation was to be launched in the Oxford area, which, because of its size, was bound to attract public attention. That is quite usual in cases that are likely to be reported extensively in the press, so that Miniters are not caught unawares by the figures of the people involved. Ministers are not asked for authority, nor are they given details of the way that the operation is being conducted.

Mr. Bennett: Presumably the Minister did not see the note because he was away on holiday, but did it go to both of the hon. Gentleman's colleagues in the Department? The Minister says that it contained a figure showing the size of the fraud. What was that figure?

Mr. Rossi: I am not sure whether that note went to all the Ministers in the Department at that time. Therefore, I cannot answer the hon. Gentleman's first specific point. I saw the note when I returned from holiday, and I can fairly say that if I had seen the note before I went on holiday, there was nothing in it to alert me to the fact that the offices about which complaints had been made had been set up, or that there was anything particularly unusual about the case, other than that about 200 arrests were expected.
Although the hon. Member for Stockport, North is desperate to pin some responsibility or blame on Ministers or officials at the Department, I can assure him that Ministers were notified of the impending exercise in accordance with departmental practice which, I understand, has been long standing. Equally, it has been the practice of successive Ministers not to become involved in the detailed operations of investigations for fraud, for the good reasons that I have already given.
I hope that the hon. Gentleman is not seriously suggesting that Ministers should become involved in such investigations, because there would be implicit dangers. However, we take full responsibility for the overall policy on fraud prevention and investigation. There would be considerable disquiet generally if we did not do so, and there would be allegations of political bias if we intervened in cases, or in the planning of operations such as Operation Major.
Therefore, I hope that the House appreciates that, given the scale and nature of the fraud, there was no alternative but for the Department to co-operate with the police in that way. The fraud could not have been stopped earlier, because it was impossible to identify the 90 genuine residents out of the 200 itinerant members of a fluctuating and shifting population. It would have been impossible and improper for any official to say to Mr. Smith, who approached the counter, "Oh, you live at that address. We are not going to pay your benefit, because we feel that many of those using that address are trying to swindle us." He could not do that until he was satisfied that Mr. Smith was not at that address, and was using it falsely. That could be proved only by such an exercise and by gathering together all those who pretended to use that address to sort out those who were genuine and those who were not.

Mr. Bennett: Does not the Minister accept that from time to time this sort of problem has arisen in other lodging houses in the country? It has been solved by the DHSS, instead of police being involved. Oxford is unique, because such procedures were used, instead of the more traditional procedures that are often used when checking whether people are genuinely staying in lodging houses. I would sometimes be the first to complain, but those procedures have been used fairly extensively in the past.

Mr. Rossi: The officials involved also deal with fraud and its problems in many other ways. They came to the view that, in their professional judgment, the only way to solve the problem was to co-operate with the police, as they did. I must support and back their professional judgement, because it is for them to decide such matters. What happened after the police had effected the detention, arrest and so on, are not matters for me. I cannot answer for them in any way. The hon. Gentleman must direct his question elsewhere. His complaints, as I understand them, concern matters which are outside the activities of my


Department and outside anything for which I can properly assume responsibility. I would accept the responsibility, if it were mine, but it is not my responsibility in many of the incidents which the hon. Gentleman mentioned.
I hope that the House will agree that the matter was handled in an entirely appropriate manner by DHSS staff, who should be commended for their vigilance. The operation was carried out in pursuit of a well established policy to take vigorous action against suspected fraud against public funds. Naturally, the Department recognises that it is preferable to prevent fraud from being committed in the first place, and we are constantly seeking ways of making our claim procedures fraud-proof. However, we must keep a sense of proportion and ensure that any checks that are introduced are not so burdensome as to deter the genuine claimant. It must be accepted that there are inevitably areas in which the benefits system is liable to be defrauded. Nevertheless, the Department has a duty to try to maintain the integrity of the system, and it must always be prepared to take effective action against fraud, wherever it is found.

Orders of the Day — Pensioners (Living Costs)

Mr. A. W. Stallard: This debate, timed as it is immediatedly after the publication of the White Paper on public expenditure, and just a few weeks before what could well be the present Chancellor of the Exchequer's last Budget during this Parliament, gives me the chance to raise again some of the more worrying aspects covered by the broad title of "Pensioners (Living Costs)." I hope that it will also provide the Chancellor with some thoughts on how to improve the content and quality of his forthcoming Budget speech.
I begin by repeating a plea that I and many others have made for some years for an urgent review of pensioners' incomes and spending needs, compared with those of the rest of the population, and an urgent rethink of the need for a new method of calculating and uprating pensions more accurately in accordance with pensioners' needs, while striving to allow pensioners the maximum personal choice on how to spend their income.
Almost all pensioners' organisations have argued for a long time that neither the official retail prices index nor the pensioner prices index accurately reflect the living costs of elderly people. The Social Services Select Committee, in its recent report to the House, House of Commons Paper No. 123, said:
There are good grounds for believing that the welcome fall in the rate of inflation over the past 12 months has not been fully reflected in the expenditure patterns of pensioners and other groups of social security beneficiaries".
It went on to say:
Expenditure on fuel and light in particular accounts for between 15 and 20 per cent. of expenditure by poorer pensioner households, and there is reason to believe that these costs are rising faster than the retail prices index in general. Indeed the retail prices index figures for fuel and light rose by 2 percentage points between November 1982 and December 1982 alone, compared to a general RPI rise of 0·5 percentage point".
Further proof of what I am saying was contained in a written reply to my hon. Friend the Member for South Ayrshire (Mr. Foulkes) on 7 December, when the Chief Secretary to the Treasury said:
The 1·5 per cent. fall in the mortgage rate announced in August will have reduced the retail prices index by 2/5 per cent. The further 2 per cent. fall announced in November will in due course reduce it by another 3/5 per cent."—[Official Report, 7 December 1982; Vol. 33, c. 494.]
That was his reply, although, according to another written reply on 13 December 1982, at c. 55, only 100,000 pensioners own their homes on a mortgage and will thus benefit from that fall.
The British Association of Retired Persons, in a letter to The Daily Telegraph, said:
One aspect of the index-linking of old-age pensions which appears to have escaped the notice of both Sir Geoffrey Howe and Mrs. Thatcher is that the method of calculation of the retail prices index is most unjust towards old-age pensioners. The recent reduction in the rate at which the cost of living continues to rise is largely due to the fall in interest rates having caused a reduction in the mortgage interest element included in the RPI computation. Few retired persons, however, have mortgages, having paid such off by thrift during their working lives. Moreover, many retired people have their lifetime small savings on deposit with the building societies whose interest rates to depositors are now being reduced, the small supplementary incomes of the retired being thereby reduced while prices of food, fuel and other necessities continue to rise.
No one can say that the association is full of people who think as I do. It could have mentioned that a reduction in


the price of motor cars had contributed to a lower inflation rate. I am not aware that many pensioners in my constituency will have been affected by that reduction.
Paragraph 15 of the report of the Select Committee on Social Services stated:
It would be in the highest degree unfair if, at the moment that pensioner and other households find their costs are rising faster than the general rate of inflation, on fuel and light in particular, their benefits were adjusted in line with that general rate.
All hon. Members will, I think, agree with those sentiments.
A recent booklet entitled "Inflation and Elderly People", issued by Age Concern as a discussion document, estimates, on the basis of an alternative pensioner index, that pensioners have experienced 12 per cent. more inflation than other households since 1974. The author, Mr. William Smith, a lecturer in economics at the University of Kent, produces statistics and tables to prove that assumption. He argues that to keep pensioners' future living standards in line with the true rate of inflation, as it affects them, they should be linked to a new prices index.
Mr. Smith concludes that the use of the present retail price index as a measure of price rises for pension increases is inadequate. This, he says, is a cause for great concern, considering the amount of poverty among pensioners. A single person's pension amounts to only one-fifth of average male earnings. A married couple's pension is less than one-third of average earnings. Nearly half of all pensioners—over 4 million people—have to claim means-tested benefit to supplement their pension.
In his booklet Mr. Smith says of pensioners:
However, their demographic importance is not reflected by their economic status. For example, total expenditure in the economy by single person and married couple pensioner households is only 12 per cent. of the total for all households, despite pensioners comprising approximately 22 per cent. of the adult population.
That statistic is not widely realised.
The discussion paper concludes that, to keep in line with the living standard of those in work, the link between pensions and earnings should be restored. That is part of the problem which we all know as the break in the link. I assume that the Minister has read the booklet to which I have referred, because it has been widely distributed, and I hope that he will be able to comment on the useful points that are made in it.
There are many more more well-researched examples of the injustice being done to pensioners and other beneficiaries by the continued use of the present method of linking. I hope that the Chancellor and his colleagues will consider the need for an immediate review and the early introduction of a more accurate prices index that will reflect the true differentials of the pensioners' inflation rate.
I have mentioned the link with wages and the fact that the Government have broken that link. That is just one of a series of measures introduced by the Government to cut costs and save money that have seriously affected pensioners. By breaking the link with pensions the Government saved £500 million, but a married couple lost £2·25 a week. By delaying the date of uprating by two weeks the Government also made a huge saving, but a married couple lost £12·30 a week.
By freezing the earnings rule, despite a clear manifesto commitment to abolish it, the Government made further savings. The poorest pensioners on supplementary benefit received increases which were lower than the rate paid to other beneficiaries—0·5 per cent. less—due to changes in the method of calculating increases as a result of the changeover to housing benefit in November 1982. We know, too, that some pensioners will have lost entitlement to certain forms of heating allowance from November 1982, although at the moment the numbers are not available.
The total savings from all those measures must be well in excess of another £500 million. It is also a fact that the Government saved £160 million by the 1 per cent. clawback in 1981. A case can easily be made for saying that the Government owe money to pensioners, rather than to talk of further clawbacks.
According to the most up-to-date statistics, 1,119,000 pensioners in 920,000 households are dependent on incomes below the supplementary benefit level. The White Paper published last week shows that an estimated 1,730,000 pensioners are receiving supplementary benefit. There are also an estimated 2 million pensioners receiving either rent or rate rebates and many more who should be but do not claim. Therefore, we are talking about more than 4 million pensioners either living in poverty or just above the poverty line after three years of this Government.
In the face of all that, what are the Government doing? In his autumn Budget the Chancellor announced that because of overestimating at the Treasury pensioners had been overpaid. He said:
We accordingly intend to make an adjustment to next year's uprating."—[Official Report, 8 November 1982; Vol. 31, c. 314.]
Quite rightly, as was to be expected, that announcement brought anger from pensioners and pensioners' organisations throughout the land.
I do not want to burden the House with long quotations, but it is appropriate to quote from "Pensioners' Voice", the official organ of the National Federation of Old Age Pensions' Associations. It says:
The Chancellor's announcement of a 'claw back' from this year's uprating met a bitter and angry response from the National Executive. The proposal was condemned as callous and cheese-paring and the following letter sent to the Prime Minister and the Chancellor.
The letter contained the following paragraph:
The decision was condemned as callous and cheese-paring coming, as it does, at the end of a year which has seen allround increases in the basic essentials of life. Statistically, it may be possible to prove a fall in inflation. Practically any pensioner will tell you that prices in the shops, on the buses and especially the cost of heating continue to rise. Further, the retail prices index is hardly a fair yardstick by which to calculate the living cost of pensioner households. The pensioner prices index is much more accurate and throughout this year has exceeded by four or five points the RPI. On the basis of that statistic, therefore, it would appear that a 9 per cent. increase is correct. There is no overpayment.
It went on to say:
The cut now proposed, although of itself apparently insignificant, will mean a loss of £41 to single pensioners and some £67 to married couples. A considerable sum especially when one considers that it will be deducted at a time when inflation can again be expected to rise.
Hugh Faulkner, the director of Help the Aged, said:
Help the Aged is dismayed and despairing on hearing the announcement by the Chancellor that pension increases next year will be reduced because of the more rapid fall in the rate of inflation than had been anticipated. It is an act of hurtful


meanness deliberately reducing pensioners' standard of living and ignoring their years of battling against heavy inflation on a pension which is still all too low. The Chancellor has lost his sense of compassion as well as his trousers".
The Britsh Association of Retired Pensioners had this to say:
Most old-age pensioners need every penny of their present near-poverty-level pensions, and any threat further to penalise them seems to be singularly inept treatment of some 9 million voters with a general election in the offing. Perhaps the Chancellor is only making this threat of a 'claw-back' with the intention of withdrawing it in his spring Budget, but even the possibility has caused much worry among the elderly and it is our sincere hope that either the Chancellor of the Exchequer or the Prime Minister, or both, will take an early opportunity of setting at rest the fears that they have raised in the minds of the old aged pensioners of the United Kingdom by their recent statement".
Those are just a few of the many reactions to the autumn Budget announcement of the claw-back. I know that the phrase upsets Ministers. Nevertheless, it is true.
Age Concern and the British pensioners trade union action committee made similar responses. It is hoped by all of us that the Cabinet is reconsidering the situation.
From recent pronouncements by Ministers, it seems that some rethinking is going on. For example, following the Chancellor's very definitive statement, there have been a number of follow-on statements. The Secretary of State for Social Services, for instance, said:
Decisions on what the 1983 uprating should be will be taken, as usual, at the time of the next Budget. Legislation will be introduced as necessary, but I have no specific timetable in mind at this stage."—[Official Report, 30 November 1982; Vol. 33, c. 125.]
On 15 December, the Minister who is to reply to the debate said to the Select Committee on Social Services:
I hope to avoid legislation
—there was a change—
if at all possible, because legislation leads to other problems".
There one sees a slight shift in the language and in the emphasis. It is a welcome shift if it goes far enough.
In further evidence to the Social Services Select Committee on that day the Minister said that
there is no statutory restriction on the size or frequency of uprating on, for example, war pensions, supplementary benefit, child benefit, one-parent benefit, family income supplement, mobility allowance, death grant, maternity grant and Christmas bonus".
In a letter to myself on 6 January of this year, Lord Trefgarne, who is a Minister at the Department, said:
All we have said is that the level of next year's increase in pensions and other benefits in November 1983 will be decided at the time of the next spring Budget. It will then be necessary to consider to what extent we have to bring pensions and other benefits in line with inflation or allow them to continue to run ahead of it".
There is a change of language, almost moving away from that definitive statement by the Chancellor in his Budget.
Page 66 of volume two of the public expenditure White Paper states:
It is intended that the decisions about the increases in November 1983 will have regard to the fact that the forecast increase in prices over the year November 1981 to November 1982—on which the November 1982 uprating was based—exceeded the actual rise in prices over that period.
That again is an attempt to soften the language.
Could it be—we are entitled to speculate—that there will not be a claw back, that there will merely be a tiny claw back, or, as the Minister seemed to suggest to the Select Committee just before Christmas, that there could be a claw back on benefits which the Government are not required by legislation to uprate in line with inflation?
To most people there is something very wrong with a procedure that can produce such a farcical and worrying situation. In any other walk of life, increases are agreed and, if necessary, back pay is given, often by a lump sum, if negotiations drag on past an agreed date. No one else must rely on an estimate made in March for an increase the following November, with the uncertainty and possibility of having some snatched back. We can imagine what would happen in industry if that procedure were applied.
The days of this pernicious procedure must surely be numbered, and the Government should urgently seek alternative methods of indexing and uprating pensions. On probably their last Budget before the election, the Government should announce an urgent review of the present method of calculating upratings. In the meantime, they could restore the link with wages, extend heating allowances to those on rent and rate rebates, increase the capital cut-of from £2,500 to at least £3,000, raise the £300 limit for single payments to £500, and restore I he death grant to its 1949 level. There are plenty of arguments to justify all those propositions, and these few modest requests would go some way towards improving the serious plight of thousands of pensioners.

Mr. Thomas Cox: I welcome the opportunity to take part in this debate, just as I welcome the debate itself. All hon. Members are aware that the problems faced by our 10 million elderly increase year by year. We often tend to think that, once a person has retired, he needs less income that he received when at work. Indeed, most people accept that once they retire, their income will fall. However, we often forget that people have built up a standard of living while at work, and they have the right to expect to retain that standard once they have retired.
Sadly, many of the essential services such as heating and lighting are needed far more in retirement, when people are at home all day rather than out at work, and such services cost a lot of money.
On many occasions in the past few months we have raised the subject of standing charges, none more consistently than my hon. Friend the Member for St. Pancras, North (Mr. Stallard). Eventually the Government became extremely concerned, although the concern came initially from the Opposition, and changes have now been made in standing charges for people who consume very little gas or electricity.
Standing charges, however, are only part of the problem. For many people, the real problem is the size of the quarterly bill that they have to pay. At Question Time on 31 January, figures were given, which the Secretary of State for Energy did not challenge, to show that since the last general election gas prices had increased by 97 per cent. and electricity prices by 82 per cent. Many people, especially retired people, find it extremely difficult to meet those exorbitant price increases. If the Government are really concerned, they should reduce the amount that people have to pay for their heating.
As my hon. Friend the Member for St. Pancras, North has said, and as the Minister must know from his travels throughout the country and his meetings with pensioners' groups and representatives, the one constant request is for an increase in the heating allowances that are now paid. I hope that the Minister will not merely tell us that the


Government are aware of this, concerned about it, and so on. I hope that he will tell us that the Government intend to do something about it before next winter.
Insulation is occasionally mentioned in the House, but one wonders how much is done about it outside. We know that there are grants to help with roof insulation, which has a major role to play in heat conservation within the home, but what about the windows and doors, especially in the older properties in which so many retired people live? It is no use heating a house if the heat is lost through ill-fitting windows and doors. What constructive policy can the Government offer to deal with that problem?
The Chancellor will soon be introducing a new Budget. The one thing that pensioners will certainly watch is whether the threatened clawback occurs. Let us hope that it does not. Let us have none of the talk in which some Ministers have indulged about how pensioners must be realistic and recognise that they were paid far too much in the past because inflation did not increase so fast as the Government expected and a slight reduction will be no great loss. According to the popular press, the Budget is likely to contain many pre-election handouts. I am sure that no hon. Member is in any doubt as to the deep offence that pensioners will feel if the clawback operates.
We hear from the Government that inflation has fallen, but the real issue is the cost of commodities in the shops. That does not fall. Hon. Members should walk around the shops and, if they are in any doubt about my assertion, talk to pensioners. They should tell them not to complain because inflation has fallen, as have prices—and then wait for the abuse from pensioners who will ask, in no uncertain terms, "What kind of world do you live in? What prices are falling?" Therefore, the threatened clawback is a crucial issue.
I realise that my next remarks may be somewhat controversial, even with my colleagues. Pensioners have complained bitterly to me about the amount of income tax they must pay. It is because they have a state pension and also a work superannuation pension. I well understand their concern. When they were at work, and wages were much lower than they are today, many of them made the effort to join company superannuation schemes to look after themselves when they retired. Now, they feel that they are being unfairly treated in the amount of income tax they must pay on the total income. I am sure that many Treasury Ministers could, in a matter of moments, demolish that argument, but I know from the pensioners I meet—ordinary working-class people—that when they were in work they genuinely tried to provide for themselves in retirement. They feel aggrieved about the amount of tax that they must pay.
As we approach the forthcoming Budget, if there is a possibility of giving an additional £1 in tax concessions to the retired person or those in the low income group, rather than to someone in receipt of a salary of hundreds of pounds, I am sure that there will be little doubt in people's minds where the priority should lie. That matter will be watched closely by pensioners throughout Britain.
The title of the debate is "Pensioners (Living Costs)". It covers many issues, and I wish to touch upon one. In my area there is a sub-post office in Franciscan road, Tooting. I am told that it is under review. I am sure that many hon. Members are in no doubt about the meaning of "under review". It is that there is a real possibility that it

will be closed. If that should happen, it would be an utter madness that wholly ignored the needs of that area and the local residents. The sub-post office covers a populated area in which many elderly people live. They use that office.
The office is popular, as is the sub-postmaster who runs it. I received 22 letters from constituents today. They are worried by the knowledge that the sub-post office is under review. I shall read just one which is typical and gives some idea of the strength of feeling that exists:
I have been given to understand that my post office at 180, Franciscan road, SW17 is threatened with closure. If so, it will be a great hardship for us pensioners because we will have further to walk. Also, we will have to cross busy main roads, which is dangerous for elderly people. My wife is 75 and I am 77. I strongly protest against the closure. Will you give this every consideration and do all in your power to oppose?
In part of my constituency called Bedford hill, there is housing occupied by elderly people but not on a bus route. Many of those people have to take a taxi to go shopping because they cannot walk up and down the hill. The taxi fares can be anything from £1·50 to £2. It is often difficult for elderly people to walk long distances. If the sub-post office is closed, many elderly people will be forced to take a taxi to draw their pension. That would add to their costs.
Every hon. Member should be aware of a report which could affect us all, even those in the Minister's constituency. It says:
Post Office chiefs were considering a plan to close 200 post offices and 3,000 sub-post offices. They were also thinking of downgrading another 1,500 main post offices to sub-offices and shutting others at lunchtime and on Saturdays. Such plans would hit tens of thousands of customers who would have to travel further to the nearest post office. Hardest hit would be the old age pensioner and people without their own transport and the disabled. The plans have been drawn up by Lord Rayner, until recently a top adviser to Mrs. Thatcher.
I do not know what the Minister can tell us about that. He should say what is taking place. It would be better for every hon. Member if he made a statement soon. Not long ago there were mass rallies protesting at closures. We had a special debate on the threatened closure of sub-post offices. Hon. Members were left in no doubt about the disastrous effect that that would have on local communities. We are entitled to know what is happening now.
My hon. Friend the Member for St. Pancras, North talked about pensioners' living costs. In my area which is a built-up area of inner London, people have to take taxis to shops because there is no bus service. Therefore, I hope that we will hear about that matter as soon as possible.
Pensioners now form a large part of our population. No hon. Member would dispute that conditions have improved, but there is still a long way to go. If any one is in doubt about that, all he has to do is to attend the all-party pensioners group, regularly attended by hon. Members of all parties, and listen to the pensioners' representatives talking about the varying concessionary fares schemes, television licences, the death grant and so on, which are of crucial importance. The pensioners have to pay for those important services.
The Budget will soon test the Government's concern for a large section of our population. Who will benefit? Will it be the wealthy or the pensioners and those in the low income groups? Many people both in the House and outside will be watching how the Government as they come up to the next election treat each section of the


community. Many people in my constituency will keenly watch where the Government put their priorities in the next few weeks.

The Minister for Social Security (Mr. Hugh Rossi): With the leave of the House. I am grateful to the hon. Member for St. Pancras, North (Mr. Stallard) for the way in which he introduced the debate. I am well aware of his concern for pensioners and of the fact that he represents many pensioner organisations in the House. He will forgive me if I do not answer all the matters that he raised. If I understand him correctly, he addressed his remarks more particularly to my right hon. and learned Friend the Chancellor of the Exchequer than to my Department. I cannot anticipate what he will or will not do in his Budget Statement, nor can I anticipate what my right hon. Friend the Secretary of State will say in any uprating statement.
The hon. Member for Tooting (Mr. Cox) referred to the threatened closure of his sub-post office. I regret that I can give him no answer on that matter as it does not fall within my responsibilities. Nevertheless, I can share his concern. I have had similar problems in my constituency. One has to do battle with the chairman of the Post Office. One wins some and one loses some. That is the only comfort that I can give to the hon. Gentleman.
I share the concern of the hon. Member for St. Pancras, North about pensions. I agree with him that for someone who is solely dependent upon the old-age pension life is very difficult. It always has been for someone who has not been able to accumulate savings of his or her own during a lifetime or enjoy the benefits of an occupational pension as well as the State pension. That is why we have supplementary pensions that assist people who find themselves in that unhappy situation.
One recognises that people in that unhappy position, dependent upon the old-age pension, have particular problems with the cost of heating. It is precisely for that reason that the Government have extended heating allowances for those people who need them. We are spending some £325 million in the current financial year on supplementary benefit heating additions to help the people for whom the hon. Member for Tooting expressed such anxiety. It is more than any Government have spent. There is other help that such people can receive in grants for insulation which is possibly one of the best ways in which old people can help themselves to keep warm.
Standing charges were debated in the House on 13 December 1982. I do not think it would be right for me to go over the same ground once more. The hon. Member for Tooting has tempted me, because, although he made a grudging reference to the fact that the nationalised industries are prepared to make some concession in respect of standing charges for fuel, he claims a great deal of the credit for that decision for the Opposition. The record does not show that. In 1976 the Government he supported looked at the matter and ruled out both the elimination of the standing charge and the half standing charge concession.
The Secretary of State for Energy at the time was the right hon. Member for Bristol, South-East (Mr. Benn). He said:
After considering the group's report the Government have concluded that none of these possibilities offers a satisfactory way of helping poor consumers with their fuel bills.

The Opposition had the chance when in Government and rejected it. It has been left to us to put the matter right as best we can in the prevailing conditions.
The hon. Member for St. Pancras, North referred me to a recently published booklet which questions whether the retail price index is the proper basis upon which one can have regard to the uprating of pensions. I have received the book recently and I have skimmed through it quickly. It seems to contain a great deal of interesting information. I have not yet had an opportunity to study the arguments in detail, but I shall. The hon. Gentleman quoted the Select Committee on Social Services with approval when it suited him. He did not quote that passage of the Committee's report which supported the view that the RPI remains the best price measure for general social security upratings. The Select Committee on Social Services said:
We would need more convincing evidence of a case for change than has so far been produced, to persuade us to move from an index which is widely accepted, comprehensive and reliable to any alternative so far available.
I have the authority of an all-party group of the House which specialises in such matters supporting the use of the RPI for that purpose.

Mr. Andrew F. Bennett: Will the Minister give way?

Mr. Rossi: Yes. The hon. Gentleman is a member of the Select Committee.

Mr. Bennett: I am pleased that the Minister supports that recommendation. I assume that he will be consistent and support all the other recommendations; or is he quoting selectively?

Mr. Rossi: The hon. Gentleman must await, with his usual patience, the Government's response to the report which will be issued in due time.
The hon. Member for St. Pancras, North mentioned the increases that pensioners have received compared with increases in prices. I remind him that during the Government's period of office pension levels have been increased, over four upratings, by about 68·5 per cent. By comparison, the retail price index rose by only 61 per cent. between November 1978 and November 1982. The pensioner price indices, which are often recommended by hon. Members as a more reliable basis for comparing increases in pensions, rose between the final quarter of 1978 and the final quarter of 1982 by only 58 per cent. for a single pensioner household, and by 57·5 per cent for a two-pensioner household. On those criteria, the Government have more than redeemed their pledge to ensure that pensions are fully protected against price increases.
Both the hon. Member for St. Pancras, North and the hon. Member for Tooting referred to the comparison with average adult earnings. There was a lament for the breaking of the link with earnings on the upratings. If one takes a longer period than the term of office of the present Government, to try to see those matters in a wider perspective, the hon. Gentleman will find that during the 10 years from October 1972 to November 1982 the State retirement pension rose by 386·7 per cent. As against that, average adult male earnings rose by 310·3 per cent., and the pensioners price indices for a single pensioner-household, from final quarter to final quarter, rose by 277·6 per cent. By whatever yardstick, over a substantial


period pensioners have been kept ahead of the field by successive Governments. That must be borne in mind when one is considering the general questions with which we are concerned.
The hon. Member for St. Pancras, North also mentioned the imperfections in our system for uprating pensions, because the announcement is made at about Budget time, the increase takes place in November, and in the uprating there is an element of forecast that invariably proves to be wrong, which requires an adjustment in the uprating from year to year. I remind the hon. Gentleman that the present system of forecasting, of which he was so critical, was introduced by Mrs. Barbara Castle when she was Secretary of State. When she did that, she departed from the historic method of calculating the upratings. It caused great comment and criticism at the time, because the effect of changing the method of uprating was to deny pensioners about £500 million, which at today's rates is in excess of £1 billion.
We were then left with this curious method of uprating pensions, legislated for by the previous Administration. Each uprating decision can happen at any time between March and June. My right hon. Friend the Secretary of State has to take the past six months of increases in prices and estimate the next six months of rises in prices. He must then state a percentage figure by which the pension shall be uprated. In making a forecast of a likely increase in prices in the future, certain assumptions or guesses, to use an easier term, must be made. Whenever one guesses or makes assumptions, it is only right to accept that one will not be able to get it right every time. Assumptions are no more than assumptions and can be proved to be wrong. It is not the same as a calculation based on known figures of what has happened.
Therefore, ever since the present Government have been in office, inheriting that particular way of uprating the pensions, it has followed that one year we have overestimated and another year we have underestimated the increases in prices. When we have underestimated the increases, we have made good, the underestimate as we did in November 1982. We underestimated the preceding year, so in November 1982 we added an additional 2 per cent. to pensions to make good the underestimate. If one makes that type of adjustment, it follows logically that if a forecast is going to be wrong the other way, an adjustment must be made. What is sauce for the goose is sauce of the gander. That is no more than the Chancellor has indicated might be the position when he comes to consider what he has available at Budget time.

Mr. Stallard: I did not pray in aid for my criticisms the previous conduct of any Government. I am sure that members of the Government for whom the Minister has voiced support will be touched by his support, however belated. I did not pray those in aid and I will not do so now. I would criticise them as I criticise the present Government or any Government, because I believe that all Governments have the system wrong. Now is the time for a total rethink, which is why I quoted some of the new thinking that is coming forward. I mentioned one idea from the new pamphlet to which I referred.

Mr. Rossi: I accept what the hon. Gentleman says. I do not know, and have not taken the trouble to find out, whether he voted for or against his Government when they changed from the historic to the forecasting method of uprating. I am not sure that he can recall now which way he voted and whether he gave his Government his support on that occasion. Whether he did or did not, it was a decision of his Government as a whole. That is the consequence and this is the trouble we find ourselves in today. One must consider these matters to see whether it is possible to produce a better method. The historic method has its advocates because it has certainty. There is automatic uprating within that method, albeit six months too late. The difficulties with a historic method is that one is basing the increases on past rises in prices. If there is rapidly accelerating inflation, there is an appreciable time-lag for the pensioners before the pension is put right to take account of the rise in prices which has taken place. That is the difficulty with that method.
These are matters that must be of continuing concern to the Government. We must try to satisfy ourselves that we can find the best practical means of dealing with these difficult matters. The best solution of all would be to achieve an economy in which there is very little inflation. The method of forecasting the uprating would become increasingly academic in that climate. The House knows that that has been the basis of the Government's economic policy. Our aim has been to reduce inflation as rapidly as we can and to restore the economy to a firm and sound basis. As Labour Members know, the Government have been singularly successful in their policy of reducing inflation. This has been all to the benefit of the pensioners.
I do not feel that I can take the matter much further. The various other issues which have been raised in the debate are really for my right hon. and learned Friend the Chancellor of the Exchequer or for my right hon. Friend the Secretary of State. I cannot anticipate statements that they may be making in future.

Orders of the Day — Abducted Children

Mr. Reg Race: The problem to which I seek to draw the attention of the House at this unearthly hour in the morning is a growing and serious one throughout the country. It is the problem of child abduction—child stealing—which has faced many of my constituents over the past three and a half years.
In my constituency of Wood Green in north London, over the past two years I have had drawn to my attention three cases in which women have had their children, who were living with them at the time, abducted by their fathers. One would have thought that that might have been a chance happening, were it not for the fact that many women throughout the country have recently come together in an organisation to try to draw attention to their plight. It is a multi-faceted plight and that is why I am concerned about the attitude of the Foreign and Commonwealth Office and the Home Office towards this matter, which affects both Government Departments.
When one talks to Foreign Office officials they say that the number of abduction cases with which they deal can be counted on perhaps the fingers of four hands during one year. That is the tip of the proverbial iceberg, for a number of reasons. First, the Foreign and Commonwealth Office does not see many of the cases that are to be found in the community. It deals only with cases of children who have been taken abroad or who are now believed to be abroad. I suspect that, similarly, the Home Office does not see the children and the women who are involved because many people are deterred from raising the matter with Government Departments, having once raised it with the police.
I want to try to show this morning the practical difficulties that face my constituents and women throughout the country. It is mainly women who are affected by the problem. They face practical problems because of the enormous difficulty that they are in and because of the feeling of powerlessness that they have about the enormous problems that are being placed on their shoulders.
I do not wish to ask the Minister to answer problems relating to specific cases, but rather to refer to the generalities of the problem. However, all the cases that I have had to deal with over the past three or four years have been extremely heartbreaking because of the problems that the women have had to face. I wish, for the benefit of the House, to place on record a demonstration of the practical difficulties that these women face.
I do so by describing one case in my constituency, which began in 1980. On 23 February 1980, Mr. Mohammed Waseem drugged his wife Seema and two teenage daughters Sameena and Rubeena. During the night he abducted the two youngest children of the family, Khalid, then aged 12, and Shahina, then aged only one, and took them to Pakistan.
The family live in my constituency, but the children were taken in the middle of the night, and it is believed that there was some collusion between Mr. Waseem and other members of the family over the abduction. Mr. Waseem had planned the abduction unbeknown to his immediate family for some time, when in the preceding months he had talked them into moving from their comfortable home in Enfield to a fairly run-down house

in Wood Green. He told them that this was to release the capital tied up in the house so that he could set up in business on his own and leave his work with the Civil Service.
However, Mr. Waseem's real intention was to steal the money, which amounted to £26,000, from the sale of the house in Enfield, and which was then in the bank, leaving his wife and daughters with the massive mortgage of £20,000 and no means of support. Incidentally, he removed the £26,000 from the joint bank account on only his signature without the bank querying his withdrawal. When he left, taking the children with him, Mr. Waseem took the family's passports and his wife's jewellery.
There is also some evidence that Mr. Waseem may have sawn a gas pipe in half so as to destroy the house and the people in it. These were the actions of a man who had very little regard for human dignity or for the family with whom he had lived for such a long time.
After these incidents in 1980, Seema Waseem's life became tragic. She has had to fight for supplementary benefit to live, to keep her home, and, worst of all, for the return of her two children. Khalid and Shahina are both British citizens born in the United Kingdom, and they have been made wards of court through the judicial process in this country.
However, because the children have been removed from Britain, Mrs. Waseem had to go to Pakistan to fight for their return. She therefore had to leave Britain in the summer of 1981, and did not return until autumn 1982. Court proceedings were extremely long-drawn-out, not least because at one stage her husband attempted to bribe the clerk of the court in Pakistan to hold things up.
Seema Waseem obviously had no means of paying for her passage to Pakistan. After her husband left her, she had no means of support. She had no job. She had to go to the local DHSS office to claim supplementary benefit, as was her right. In itself, of course, supplementary benefit does not provide the wherewithal to purchase air tickets for Pakistan. No practical assistance was available from the state for the legal costs of fighting an action in Pakistan to recover the children. No legal aid is available for court cases conducted abroad to recover abducted children. I want to take up that point with the Minister later.
Therefore, Seema Waseem had to leave for Pakistan with no financial support of her own, knowing that in fighting for the return of her children, she would incur huge debts. She had to leave behind her two teenage daughters who were both at college. They had to fend for themselves and cope with the bills and problems to which their dilapidated house in my constituency gave rise. Incidentally, they coped extremely well with that dreadful ordeal.
What then happened is extremely instructive. Having taken the matter—as she was advised to do by me and by the Foreign Office officials whom we saw—through the courts in Pakistan, she eventually, after a lengthy legal process, won a whole series of court cases, including appeals by her ex-husband against the court's first decisions. I am now happy to say that she has almost completed all the legal processes in Pakistan. I believe that there is only one formal hearing still to come in that country, and it is expected that it will be finalised this month.
However, her basic problem still remains. She still has not managed to recover her children. She still does not know quite where they are and the problems that she has


experienced as a result of that traumatic event in her life are extraordinarily complex. They show, in miniature, some of the problems that such women face. I should like to place them on record, because Ministers do not yet fully understand such matters. I say "fully understand", because I accept that there has been a change in the attitude of the Foreign Office recently, which I greatly welcome.
I shall outline the common strands in the Waseem case and the two other cases that I have had to deal with as a constituency Member of Parliament during the past three and a half years. First, it is plain that in most cases it is the women who lose their children, and the men who take them away. Indeed, when the Minister recently met a delegation at the Foreign Office, he must have been as impressed as I was by the balance of the sexes. I think that there was one man in the delegation, and about eight or 10 women. I suspect that that balance is a true reflection of the numbers of men and women who are affected. Thus, child abduction becomes an issue of women's rights, as well as one of equality, fair play and fair dealing.
There is a second common strand in these cases. Often the parents do not know where their children are. That was what happened with Mrs. Waseem. Although she knew that, initially, the children were in Pakistan, she did not know whether they had been taken elsewhere. It was thought at one time that they might have been abducted to Libya, as Mr. Waseem's brother was in the Pakistan air force and was thought to be based in that country. Nor did she know where they were in Pakistan, if they were in that country.
The same thing happened in the other cases which arose in my constituency. One case involved a woman whose two children were taken by her ex-husband to Italy. She did not know, when she came to see me for the first time, where her children were. In the third case in my constituency, again the woman did not know where her children were. She did not know which country they were in—in Britain or in another country to which her ex-husband might have taken them. Women, or parents, feel powerless in such cases. They may not know where their children are. They may not be able to cope with the multiplicity of practical problems that beset them, and we in this House should take seriously the practical difficulties facing those women.
That brings me to the third common factor in these cases—the multiplicity of problems that the women face, once financial support has been removed from them. I do not suggest that women are incapable of looking after themselves. Of course not. However, in many cases they are forced to rely on supplementary benefit and they are faced with many difficulties.
First, there is a practical problem. Some of their money may have been stolen. There may also be the difficulty of claiming supplementary benefit. Although it is easy to go to the local DHSS office and claim the basic scale rate of supplementary benefit, when it comes to paying the legitimate mortgage interest costs of an owner occupier in this situation, the DHSS has a discretion not to pay if it thinks that the costs are unreasonable, or to pay part of the costs if it thinks that the total costs of the interest are unreasonable.
My constituent, Mrs. Waseem, had to fight extremely hard, with my assistance, to get the local DHSS office to pay those costs, because without that practical assistance

she would rapidly have become homeless. As it happened, because she still had two children in full-time education, the local authority would have had a statutory responsibility to rehouse her under the Housing (Homeless Persons) Act 1977. It would, however, have been another enormous hassle for her and her family. Luckily, it did not come to that.
Another practical difficulty is the problem of whose name the house is in. If it is a tenancy, particularly a local authority tenancy, the tenancy is often in the name of both the man and the woman. The same is true in the case of an owner-occupier. One difficulty for the woman is obtaining a property transfer order when notice cannot be served through the court on the respondent. There is a long-drawn-out process whereby the woman has to try to regularise her position in relation to her own housing.
That is not all. If a woman or a parent has to go abroad to fight the court cases that are necessary to recover abducted children, it is obvious that during the period that she is away the existing home still needs servicing. Money is required to keep it going. Someone has to pay the rates, the gas bill, the electricity bill and perhaps the telephone bill. For those on supplementary benefit, the local DHSS office pays the benefit in the normal manner to a named householder claimant while that person is in England and for a short period of four weeks if it is necessary for the person to leave the country for a legitimate purpose. After the four weeks, benefit stops. Unless there is someone else in the household who can claim supplementary benefit, the home itself is threatened. There is no means of getting finance into the house to keep it going.
Many of my constituents, including at least two of the women I have been speaking about, were in that position. They had to travel to a foreign country to try to win back their children while, at the same time, dealing with an enormously complicated set of practical difficulties placed in their way by the operation of the local welfare state. It is a real problem for these women. I do not believe that these problems are properly appreciated in all their detail and power by the Government. One of the purposes of this debate is to try to draw the attention of Ministers to these serious practical problems.
Matters may not progress to the extent that I have described. If children are abducted, it is possible that the parents will say that they have looked for them in all possible locations in the United Kingdom but cannot find them, that they have insufficient money to go to another country to continue their search, that they have not sufficient money to pay for legal assistance in that country where legal aid is not available and that they therefore give up. It is extraordinary that parents are being forced into that position by the weight of practical problems which is placed on their shoulders.
Parents are faced with three choices. First, they can go to another country and fight a battle through the courts which might be extremely costly in all its aspects. Secondly, they can do nothing. They can say that they simply cannot afford it and give up. Thirdly, they can short-circuit the legal process and attempt to snatch their children back from their ex-spouses if they know where they are. Frankly, I do not believe that those options are in the best interests of either the parents or the children. For all those practical reasons, there should be a change in the way in which both the Foreign Office and the Home Office go about their business in child abduction cases.


There is also a strong case for changes in international law to make more easy the recovery of children who have been removed from their homes in the United Kingdom.
I want to draw to the attention of the House some of the enormous problems which parents face when their children are abducted in relation to the attitude of the Foreign Office and the Home Office. The clear advice which is given by Foreign Office officials in the consular section if a parent goes to see them because a child has been removed is that the battle must be conducted through the courts in the country where the children are believed to be. That advice is given to everyone; it is impartial and general.
The Government's general attitude seems to be that, as this is a domestic or civil matter, a matter between spouses who have lived in the same home and had children, they cannot intervene. That is a convenient way for the Government to get themselves out of the difficulty of having to do something about it. It also reflects both international and United Kingdom law.
When parents go to a foreign country to try to recover their children they take the battle through the courts. They may approach the consul in the country for assistance. Very often—certainly in the case of one of my constituents—that assistance was denied. I do not want to make a meal of this because I know that the Government have changed their policy—and a good thing, too—but some British representatives in some countries in the past have told parents who have come to see them that they cannot intervene in such matters because they are domestic and civil rather than criminal. They say that they cannot interfere with the courts of the other country and that they can do nothing except ask for a welfare report on the children concerned. That is little comfort indeed to parents who have had their children removed and who, quite rightly, regard the removal of those children as a crime.
I welcome the way in which the Government have issued a new circular to their consulates throughout the world urging them to be more helpful to parents who ask for assistance in other countries. That is long overdue. Parents facing practical problems in other countries will greatly welcome the assistance of the United Kingdom Government in seeking to make representations to other Governments about the location of their children and also about the long delays in the legal process that can be extremely costly and frustrating and destroy the chances of parents getting their children back at all.
The new Foreign Office circular will be helpful. Unfortunately, that is not all. There are two other problems to which the Government must turn their mind. The first point is of international law. A delegation from the new organisation of parents who have had their children abducted went to see the Minister of State. He made the pertinent statement that if they were in favour of reciprocity between countries, of being able to go to foreign countries and getting their children back because of a court decision made in the United Kingdom, it must follow that the same would be true of parents coming to the United Kingdom in the belief that their children had been abducted and brought here. They would be able to enforce in the United Kingdom a court order made in another country.
I and the parents who saw the Minister say that that is right, but they accept that there are several practical problems. No doubt the Minister will receive representations from some hon. Members about constituents

threatened with the removal of their children as a consequence of court orders made in another country. That must be considered very carefully. On balance, I, and I am sure many of those parents who have been affected already, favour the idea of reciprocity. The Hague convention ought to be endorsed and implemented as swiftly as possible.
The Home Office is involved when a child is thought to be in the United Kingdom. If that is so, the matter proceeds through the High Court. The children are searched for by the police. The missing persons department of the Metropolitan Police, in the case of London, takes action on the instructions of the tipstaff of the High Court. The tipstaff of the High Court has extremely limited resources. Only three or four people actually work in that department. They do not have the resources to track down or follow all the leads that undoubtedly exist in any particular case. The police are sometimes reluctant to act on information that they receive from other sources about the possible location of children who have been abducted within the United Kingdom. They are reluctant to do so, first, because they receive their instructions from the tipstaff of the High Court and, secondly, because it is a civil offence and not a criminal offence.
Responsible and decent policemen concerned about this issue have told me that they would do more about abduction cases if it was a criminal rather than a civil offence. We in the House of Commons should demand a change in the law in Britain to make child stealing or child abduction a criminal rather than a civil offence.
These brave parents must overcome the great difficulty of finance. They are faced with enormous problems over arrangements in the United Kingdom. They face the great difficulty of fighting court battles, sometimes many thousands of miles away, with no legal assistance. Therefore, there ought to be some way in which they can claim on a fund to finance the attempt to recover their children.
The Minister should consider the possibility—no doubt he would have to consult his Government colleagues—of setting up a fund, paid for by the taxpayer, from which parents could claim if they were forced to fight to get their children back to the United Kingdom. The creation of such a fund is long overdue. It would have to be means-tested, and there is no reason at all why that should not be the case. In any event, parents must have somewhere to go to for practical help.
This is not a small problem. The Minister may argue that such parents can go to a registered charity to obtain financial assistance, but the problem is that most registered charities will not make grants to individuals. They must be made to other registered charities or to corporate bodies. Therefore, there is an enormous problem about the individual obtaining a financial grant from a charity. Even if he does, it is unlikely to cover more than a small fraction of the costs of fighting a court case or meeting travelling expenses.
The Government must now turn their attention to the possibility of establishing such a fund to enable parents to have an equal chance of getting their children back. Many parents—certainly the women to whom I have spoken from my constituency and elsewhere—feel that they are fighting with one arm tied behind their backs and with the weight of enormous problems around their heads. Our job this morning is to try to relieve them of some of those


burdens and to assist them in a traumatic period of their lives. We should do something practical for women or parents who have faced one of the most awful things that can ever happen to a human being—the abduction of their children. I very much look forward to hearing what the Minister has to say.

The Minister of State, Foreign and Commonwealth Office (Mr. Douglas Hurd): I ask for leave to address the House again.
I entirely agree with the hon. Member for Wood Green (Mr. Race) about the importance of the subject, and he has taken us fairly and thoroughly through the problems that have occurred in his constituency. I am glad that we have this opportunity to go over the ground again, because since the House last discussed the general problem and also a particular case in an Adjournment debate initiated by my hon. Friend the Member for Cambridge (Mr. Rhodes James) two days before Christmas, we have taken some decisions on the matter and others may be taken before long.
The hon. Member for Wood Green referred to the very useful and, for me, instructive meeting on 26 January with a delegation led by his hon. Friend the Member for Keighley (Mr. Cryer) and including the hon. Gentleman himself, the right hon. Member for Wakefield (Mr. Harrison) and my hon. and learned Friend the Member for Burton (Mr. Lawrence). They brought with them Mrs. Burt, who has taken the initiative in forming the new self-help group to which the hon. Gentleman referred and a number of her colleagues all of them parents who in one way or another had been through the anxiety and anguish of losing one or more of their children, at any rate temporarily. Not all were abduction cases, and I appreciate that the anxiety and anguish are probably greatest in such cases.
I am very glad that that group has been formed, as I believe that it will be useful for individuals. When new cases are brought to our attention we do our best to help in the ways that I shall describe, but we also suggest that the parent concerned gets in touch with and perhaps joins that group.
The hon. Gentleman described briefly one of the cases in his constituency—that of Mrs. Waseem. As he specifically said that he did not wish me to go into detail about it, I shall not do so, but, as he said, we now expect the final decision of the Pakistan court before the end of the month and our consulate general in Karachi has asked to see the Home Secretary of the Sind Government to request action by the Pakistan police regarding the father's unlawful detention of the children and his failure to present them in the civil court. I appreciate that this case has gone on for a very long time and caused Mrs. Waseem great trouble and sadness, but I hope that there will be a good outcome before too long.
I wish to tackle the general points under three main headings. The first concerns the role of the Home Office, which has equipped me with something to say which I hope the hon. Gentleman will not find entirely negative. Under section 56 of the Offences Against the Persons Act 1861, it is an offence in this country to abduct a child under the age of 14 by force or fraud. That offence is extraditable, because it is listed in schedule 1 to the Extradition Act 1870.
The Criminal Law Revision Committee has recently examined this area of the law and, as the hon. Gentleman knows, in its fourteenth report on offences against the person, published in 1982, it recognised that in certain circumstances the definition in section 56 of the 1861 Act, especially the requirement that force or fraud must be an element if it is to be a criminal offence, had given rise to difficulty. The committee therefore suggested that there should be a new offence of child abduction. It would be a defence to the new offence that the abductor was the child's parent, except where the intention was to take the child unlawfully out of the country. The new offence would, like the existing offence in section 56, be extraditable.
The Government have considerable sympathy with the reasoning put forward by the committee in that part of its report. However, it deals with a wide range of other matters on which some of the arguments are less clear cut. My right hon. Friend the Home Secretary does not feel that the time is yet ripe for comprehensive legislation in that area. I take the hon. Gentleman's point—he raised it with me also on 26 January—and I shall draw the attention of the Home Secretary to it. As my right hon. Friend assesses the committee's recommendations, he will wish to look carefully at the point about abduction and any recent experience, such as that adduced by the hon. Gentleman.
As the hon. Gentleman knows, international law is an important part of the argument and, perhaps, of our hopes for improving the position of parents in the plight that he described. There are two forthcoming international conventions that could be helpful. There is the European convention on recognition and enforcement of decisions concerning custody of children and on restoration of custody of children 1980. We have signed that, and are considering ratification. We are also considering whether we should sign and ratify a second convention, which is an international convention going wider than the membership of the Council of Europe, that being the Hague convention on civil aspects of international child abduction 1980. That convention would deal with the practice of international child abduction by providing procedures to ensure that the right of custody and access under the law of one contracting state are effectively respected in another contracting state.
My right hon. and noble Friend the Lord Chancellor has recently issued a consultation document about the Hague convention. He has set out, at great length, the proposals of the convention and also discussed its relationship with the European convention. He has asked that all interested people should, by 29 April, give his Department their views on whether Britain should sign and ratify the Hague convention and ratify the European convention. The hon. Gentleman has given his views on that. I am glad that he reproduced faithfully a point that I made at our meeting, that it is no good supposing that the internatonal obligation would be only one way. It would not simply be a matter of enabling a British parent with British court orders, in cases covered by the convention, to recover children who had been taken abroad by the other parent. It would also enable parents living overseas to come to Britain with foregin court orders to obtain children presently living here.
I suspect that we might have debates of an opposite nature as parents with children living in Britain found that they might be removed from them because of an order granted in a foreign court. That would be the consequence of Britain adhering to one or both of the conventions. It must be weighed against the advantages explained by the hon. Gentleman. All those interested in this important matter should take advantage of the consultation and let the Lord Chancellor have their views by 29 April.
As the hon. Gentleman recognised, in the present state of international law, when the two conventions are not in force in respect of Britain, children are under the jurisdiction of the courts in the country in which they happen to live. British court orders, or the fact that the children are wards of a British court, do not automatically mean that the orders are applicable where the children happen to live. We have to deal with the courts and authorities of the country where the child happens to be. That is the major stumbling block with which, understandably in their distress, some parents do not come to terms. There is nothing that the Foreign Office can do to overcome that basic point.
The hon. Gentleman spent a good deal of his speech on the financial troubles of parents who have to fight a case overseas and may also face a good number of complicated financial problems at home. I understand that. I note his proposal that there should be a special fund of public money to help such parents. We shall examine that, though it is not essentially a matter for the Foreign Office. I cannot this morning hold out any hope of providing such a fund.
As the result of the previous Adjournment debate and the number of cases that have recently been brought to my attention, I have re-examined, with officials, the scope of the help that our consula posts abroad and in London can give parents in these circumstances. As the hon. Gentleman fairly said, we are sending out new instructions this week—I approved the draft at the end of last week. There are various ways in which, for some time, consuls have helped parents in these circumstances, and there are other ways which I believe they can and should use. I shall briefly list the seven points in the circular.
Consuls will continue to provide lists of local lawyers to enable parents to pursue their case in the local courts. They will also try to obtain welfare reports on abducted children and, if possible, visit them. They will continue to give any help that they can with regard to granting access to children, on the understanding that that is essentially a matter for the jurisdiction of the local courts.
The first new element is that we are giving consuls discretion and encouragement to draw the attention of authorities in the countries to which they are accredited details of British court orders that affect the children. British court orders do not have an effect in law in those foreign countries, but it might be useful for a foreign court to take account of the review of the facts and the conclusion reached by a British court.
Consuls will also do anything that they properly can to help bring about a speedy conclusion of legal proceedings. Many of these cases involve delay. Mrs. Waseem's case involved delay. The law has its delays in any country, but sometimes it is suspected that the delays go on because the issue is being avoided. It is right that a consul should be able to say at a certain stage whether a country's processes can move faster on a case.
A consul may be asked to approach the local authorities for help to trace abducted mothers. This is also relevant to the Waseem case—the parent who is living here is not sure where the children are. There is a case in the United States where that is especially true. It is right that our consuls should enlist, where they can, the help of the local authorities to trace abducted minors.
Finally, we are emphasising to our representatives ways in which they can be helpful when access has been agreed but there is a difficulty as to where the parent can see the child. I see no objection to their seeing them on embassy property, whether it be the consul's office or another suitable part of the building, or why he should not help, if that is not possible, to find a suitable place.
Those are not major or revolutionary steps. They do not change the basis on which the troubles occur. I cannot hold out hope of a fund that would relieve the financial side. However, those procedures could take the edge off some of the anxieties and difficulties. Many of the Parents wander into a world of which they know little, of overseas lawyers and all sorts of difficulties. It must be right that our official representatives should give what help and sympathy they can in a common sense way. I hope that it is now established that we should do that.

Mr. Race: I am grateful to the Minister for placing on record the details of the circular that he is issuing to our consulates throughout the world. Will he make it clear to our overseas representatives that those cases must be taken on their merits and must not be influenced by other considerations that may arise in relations between the United Kingdom Government and the Government of another country? Great offence has been caused to parents who have asked for the protection and assistance of British consular staff, only to be told that it would be difficult for them to raise that case with the authorities in that country because of the problematic relations between the United Kingdom Government and that Government.

Mr. Hurd: The consul has to decide how best he can help. If for reasons that have nothing to do with the case, our consul is not in a good position—if our relations with the country are bad, or its standards of justice are so completely different from ours that there is a great gap—it may be difficult for him to help. I am in favour of frankness in those cases. If there is a real difficulty and he sees no prospect of being able to help, and if the mere mention, for example, of a British court order might turn the thing the wrong way and be interpreted as an act of interference, the consul must explain matters as best he or she can to the parent. There are difficulties. What we can usefully do depends on the circumstances, which vary widely.
I am trying to set out ways in which we are giving discretion and encouragement to our consuls to be helpful. They must decide, in the light of the circumstances, which of the methods is best suited to the case. We are talking about dual nationals in the Waseem case. If the children are dual nationals of Britain and the country in which they are at the time, the consul must take that into account, because the courts will do so.
I thank the hon. Gentleman again for introducing this subject. I hope that he and other hon. Members who have constituency cases will encourage the parents concerned to get in touch as early as possible with the consular department of the Foreign Office, either direct or through


me. We have given much thought to the matter in the past few weeks. I hope that the new arrangements will be an improvement and that they will take some of the edge out of the anxiety. It would be helpful from our point of view if parents who are in trouble came to us early before they are deep into the difficulties that the hon. Gentleman described.

Orders of the Day — Prime Minister (Relations with the Media)

Mr. Tam Dalyell: It is a rare, very rare occurrence for a Consolidated Fund Bill debate to be answered by a Cabinet Minister, let alone the Leader of the House of Commons. It may not have been done since the opponent of the Leader of the House in the 1959 general election, in Coventry, R. H. S. Crossman, whose PPS I was, decided to take the debate himself on an awkward topic raised by a contumacious hon. Friend only to find that that hon. Friend had paddled off home to his bed without telling anyone, leaving the Minister and his officials to froth with fury at the ultimate in House of Commons bad manners.
At one level I apologise to the Leader of the House because people who have to attend the Cabinet or Cabinet Committees the following day should, in my view, not be deprived of sleep.
At another level I do not apologise, because I raise some basic issues on a delicate and complex subject facing a Government, which are addressed properly to a senior Member of the Cabinet, one whom his opponent Dick Crossman was to describe as then the most intelligent young man in the Tory party and certainly
a cut above his friend Enoch.
In raising the topic of the Prime Minister's relations with the BBC, ITN and the press over the release of the Franks report, and her visit to the Falkland Islands, I am more interested in the future than the past. The overriding significance of the behaviour of the Prime Minister and some of her entourage, Mr. Bernard Ingham in particular, is that it could set an example and precedent which could inhibit the future objective coverage of issues on which emotions are running high.
In my scale of values, the BBC's objectivity is a major, supreme, long-term national interest. If I concentrate on the BBC, it is, candidly, partly because, as a dissenting voice over the Falklands issue, I believe that ITN and IRN were fairer in opening their doors to minority and dissenting opinion.
It is the threat, actual and potential, to the supply of objective information during highly emotional situations that should interest Parliament.
The Select Committee on Defence has examined the role of the media during the Falklands war, and I shall not dwell on the period that it covered. However, one piece of background puts the debate into context. A Cummings cartoon in mid-May 1982 depicts von Hindenburg, Ludendorff, Admiral Tirpitz and the Kaiser being interviewed on "Traitorama" over the caption:
If Britain admits German sovereignty over the British Isles we'll stop the war.
It was discussed in Robert Harris's perceptive and important book "Gotcha" which analyses the blatant use of news management throughout the Falklands war.
The hon. Members for Canterbury (Mr. Crouch) and Flint, West (Sir A. Meyer), and my hon. Friend the Member for South Ayrshire (Mr. Foulkes) and I, appearing as we did, douce and muted on Panorama of 10 May to put a dissenting view, might be forgiven for not recognising ourselves as the German field marshals of the first world war.
I recall the programme, which spawned a vast correspondence in The Times, because it transpired subsequently that a number of brave journalists on the BBC staff all but lost their jobs because of the screening of the programme.
It is a matter of public record also that none other than George Howard, the normally phlegmatic chairman of the board of governors, went on the Radio 4 early morning programme to defend the right of his editorial staff to allow four rational, well-mannered Members of Parliament to express their doubts on one of the BBC's flagship programmes about the justification of the Falklands war and the dispatch of the task force.
Until the "Panorama" team made its bold decision to devote part of a programme to the dissenters' views, I had supposed that senior BBC journalists were biased against the dissenters in that war and did not give the slightest vent to the views of those of us who, day in and day out, said that we were against the south Atlantic folly.
One of them, my hon. Friend the Member for Wood Green (Mr. Race), raised an extremely important matter in the previous debate, and anyone who has had experience of the subject of abducting children abroad knows how important it is.
Throughout that period, if the polls were to be believed, about 30 per cent. of the population appeared to share our view to some degree.
We know from Mr. Robert Harris's inquiries that the Prime Minister happened to be watching that "Panorama" programme in her Downing Street study and, according to the author, was "transfixed".
She was not transfixed for very long, because she caused the Government machine to catapult into action, and lurid accounts reverberated around the lobbies and corridors of Westminster of the fraught meeting between Conservative Members of Parliament, Mr. George Howard and Mr. Alasdair Milne. "I have not seen so much blood on the walls since you and I have been here, old boy," muttered one of the more relaxed of the Leader of the House's senior Back-Bench colleagues to me.
However, the matter did not stop at Westminster. "One cannot imagine what pressure we were under for having given scope to your views," a senior BBC journalist outside London told me after the fighting was over. That was not an isolated case. Many talk in embarrassed and somewhat hushed tones of the pressure that they were under. In my innocence, I wondered what those pressures were, because I did not feel any pressure at public meetings, in my constituency meetings or from my mail.
In an article in the Sunday Times of 30 January, Mr. Geoffrey Cannon said:
Throughout the Falklands war between a third and a quarter of the population were opposed to it, and people were making up their minds on the basis of some false information—for example, on the willingness of the Argentines to negotiate, and the effect of Britain's actions on the possibility of negotiations. John Cole, BBC political editor, worried that the BBC was 'most vulnerable to criticism over its limited coverage of the internal debate in the country although many Tories would regard any coverage of this as pure speculation because the dissenting views were being kept so private.'
The debate in the country about the Falklands went largely unreported on the BBC, because the 'normal' and 'official' channels used by the BBC—the lobby system, the confidential briefings with politicians, the line taken by the 'Government machine'—went unchallenged. In the event, the BBC toed the line.

Mr. Alan Protheroe is quoted in the same article as saying that he
copied the BBC's responses to the prime minister's office as a precaution against more MP chicanery.
I hope that, by "MP chicanery", Mr. Protheroe did not mean the opposition of those of us—my hon. Friend the Member for Wood Green, myself and several others—from 2 and 3 April, to what we regarded as the south Atlantic folly. By accident of fate, the veil has been lifted a little, the curtain pulled slightly aside, to give us, to use a Scots word, just a "keek", at what is now going on in this land.
On Friday 21 January; Channel 4, on the "Alternative News", broadcast a truly astonishing clip of dialogue between Mr. Bernard Ingham, chief press officer at 10 Downing street, then in the Falklands, and Mr. Alan Protheroe, deputy director-general of the BBC, picked up by a radio ham and recorded. I asked the Prime Minister yesterday, pursuant to her answer of 27 January, Official Report c. 495,
what progress has been made in the investigation into the circumstances in which telephone calls from Mr. Bernard Ingham to No. 10 Downing Street were intercepted and recorded by a radio ham?
The Prime Minister answered:
I have nothing to add at present.
I hope that at some time there will be some explanation.
On Channel 4 it was said that it had been a scoop for the BBC as the BBC had the only crew out there, and that Downing street hinted that it might be worth the BBC's while staying on in the Falklands. I asked the Prime Minister:
what indications were given by her office to the BBC prior to her visit to the Falkland Islands that it would be worthwhile to extend the stay in the islands of their film crew which was already there?
She replied:
None. The Ministry of Defence, who made the detailed arrangements, suggested to the BBC, without elaboration, that it might be worthwhile for their television team to remain in the Falklands for a few more days.
Apparently, the Government believed that the hint was dropped on the condition that film shot in the Falklands of the Prime Minister's visit should be pooled. That was the statement made in the "Alternative News." Apparently they did not tell the BBC and the BBC thought that the material was exclusive. I asked the Prime Minister:
whether any prior indication was given to the. British Broadcasting Corporation that film taken by them during her visit to the Falkland Islands should be pooled.
She replied:
No prior notice was given."—[Official Report, 7 February 1983; Vol. 36, c. 244–45.]
I make it clear that on the particular issue of whether or not the film should be pooled, I rather agree with Mr. Ingham. Probably, in the circumstances, on balance, the film shot by the BBC should have been made available to ITN. In fairness, I quote a letter of 1 February front Mr. Alasdair Milne. I gave him warning that I would raise this matter. It says:
It was originally intended that Nicholas Witchell and his crew should return to the UK early in the New Year. Sources in Whitehall, however, made it clear that it might be worthwhile staying on, but at no point was Witchell told, formally or informally, of the Prime Minister's pending visit. The suggestion that the BBC was party to 'secret planning' has no basis whatever in fact. After Mrs. Thatcher's arrival, Downing Street officials `demanded' that the BBC film should be pooled: this we refused to do, making it perfectly clear that officials had no right to make such a demand. In keeping with long-standing practice however, we did agree to let ITN have some of our film.


What concerns me is the threatening style and behaviour of the Downing street chief press secretary as recorded on that clip.
Mr. Ingham and the Prime Minister wanted maximum coverage. On Channel 4 a recording by a radio ham was played—apparently he is a radio ham on the Falklands. No. 10 threatened the BBC with "incalculable consequences" if it did not agree to provide that coverage. Is the radio ham's version an authentic account of Mr. Bernard Ingham's conversation with Mr. Alan Protheroe, assistant director-general of the BBC? If it is, the Prime Minister's press relations are being handled at senior level by someone whom I can only call a thug. There is no other word than "thug" for the speaker on the tape as recorded. Anyone who heard the recording—I have listened to the tapes three times—would be unable to come to any other conclusion.
Yesterday I asked the Prime Minister
whether Mr. Bernard Ingham told Mr. Alan Protheroe of the British Broadcasting Corporation that the consequences of the corporation's failure to pool the film of her visit to the Falkland Islands would be incalculable and whether this was said with her authority.
The right hon. Lady replied:
We have no exact record of Mr. Ingham's conversation with Mr. Protheroe, but Mr. Ingham has no recollection of having made such a remark.
They could get a video or a recording from the Library. I think it casual to give the answer:
We have no exact record of Mr. Ingham's conversation with Mr. Protheroe.
We are talking about something which is in the public domain, something which was broadcast on television on Channel 4 and which is available from the Library of the House. Either it is a false recording or it is a true one. If it is an entirely fictitious recording, we should have been told some time ago.
I am bound to say that previous press officers in this important position—Sir Harold Evans, who occupied the position when the Leader of the House and I were first elected and who was Harold Macmillan's chief press officer, Donald Maitland, Trevor Lloyd Hughes and Tom McCaffrey—would not have thought it part of their job to behave in such a way. I repeat a quotation which I have already given, which reads:
'It is childish behaviour' Ingham roared to Protheroe, and then went on about a 'signal service—keeping you people on the islands at considerable risk to ourselves'.
I asked the Prime Minister
what was the nature of the risk of keeping British Broadcasting Corporation personnel on the Falkland Islands which was referred to by Mr. Bernard Ingham in his conversation with Mr. Alan Protheroe of the British Broadcasting Corporation.
The answer was as follows:
The risk was that it would cause speculation or a leak of information about my impending visit.
I asked the Prime Minister
whether in his conversation with Mr. Protheroe of the British Broadcasting Corporation Mr. Bernard Ingham threatened to prevent any of the corporation's film leaving the Falkland Islands unless the corporation agreed to pool it with Independent Television News and Independent Radio News; and whether this was done with her authority.
The reply was:
With my authority, my chief press secretary indicated to Mr. Protheroe that no Government facilities would be made available to return the BBC's film to the United Kingdom unless it was made available to the ITN and the IRN in the interests of fair play.

Apparently no film was to go out that night unless Mr. Ingham had the absolute assurance that it would be freely available to ITN and IRN. The issue is the pressure being put on the BBC by the Prime Minister's press secretary for the purpose of the Government.
To make a judgment, one has to hear the conversation to get the flavour of it. Put bluntly, a man who behaves like this should not occupy the important position of chief press secretary to No. 10 Downing street. He is, after all, a civil servant who operates for the Prime Minister. I cannot imagine Harold Macmillan, or Alec Douglas-Home, or the right hon. Member for Sidcup (Mr. Heath), having any truck with the kind of operator that Mr. Ingham has shown himself to be. Consideration should be given to finding him another job in the Civil Service.
Mr. Ingham's behaviour during the second telephone call to "No. 10" must force the BBC to ask questions about its so-called capitulation. "I won," chortled Mr. Ingham triumphantly when he told Mr. Protheroe things "in no uncertain terms". He gave Ingham an "assurance". Should the BBC allow itself to be pressurised by Governments in circumstances when the Downing street interest is to get maximum publicity for the Prime Minister? As Channel 4 put it, the BBC fought hard and lost. That is a very important matter.
I quote The Observer of 23 January:
Downing Street officials are inquiring into the legality of a telephone intercept of a row between the Prime Minister's press secretary and a senior official of the BBC, which was broadcast in a Channel 4 programme on Friday.
Mr. Bernard Ingham, the Press Secretary, is understood to be very disturbed that a private call he made from the Falklands to Mr. Alan Protheroe, Assistant Director-General of the BBC in London, should have been intercepted, tape-recorded and broadcast.
The producer of Channel 4's 'Friday Alternative,' Mr. David Graham, claims that the interception, and tape recording was made by a radio ham who happened by chance to tune in to the call.
Even if that is legal it is thought that a complaint to the Independent Broadcasting Authority is almost certain to be made.
I should like to know whether a complaint has been made to the IBA, and if so, what the result is? Is the BBC, in the persons of George Howard, Alasdair Milne and Alan Protheroe, to stand up in the best traditions of the BBC and refuse to be suborned by the politicians, or will it be forced to knuckle under to Government pressure?
For what it is worth, I record my complete confidence in both Mr. George Howard, whom I have known for many years, in my capacity as a council member of the Scottish National Trust. Our experience of Alasdair Milne during his stay in Scotland, when he was a conspicuously successful head of the BBC, suggests that he will be nobody's creature.
Mr. Milne told The Standard on 12 May:
We might increase our popularity by appearing jingoistic, but no one would believe what we were saying. I do not intend to trade our reputation to please such critics.
There is a wider issue. Why do we have to tolerate a lobby system in which able, gifted journalists are forced to become beholden to men in the position of Mr. Ingham who threaten assistant directors-general of the BBC with "incalcuable consequences"? Why should men and women of calibre, chosen by editors to represent newspapers at Westminster, be put in the position of prostituting their profession by keeping in with truculent, arrogant bullies of the species that the Prime Minister's press secretary has clearly become?
I do not know what Mr. Ingham was like in previous posts, but perhaps the heady air of Downing street has warped his judgment. Nevertheless, he is in a crucial position in society, and I am worried that many distinguished journalists are in what can only be called a supplicant relationship to him. We all know that the Leader of the House and the Leader of the Opposition see the lobby on a non-attributable basis on Thursday evenings. I have no objection to that. It is an understood procedure, although it can lead to misunderstandings. However, that is quite different from trekking to and fro once or twice a day to Downing street in the interest of what the system has made into a supplicant relationship.
That shuttle across the road must disturb all of us who are concerned about healthy press relations in Britain. I am not at all surprised by the Prime Minister's conduct, because domestic politics, rather than the interests of the Falkland Islanders, or high principle in resisting agression, have been her major concern since the beginning of the Falklands issue.
Indeed, the same Mr. Ingham was the right hon. Lady's hatchet man on the release of the Franks report. Of course, there was concern that the Prime Minister's gloss should be on the report before anyone had had a chance to read it.
In recent times, there has never been quite such squalid news management. Even the president of the Newspaper Publishers Association, Lord Marsh, has called publicly for the restoration of the embargo system. Even The Guardian and Peter Jenkins, who wrote in a critical vein throughout the conflict and who had shared a platform on 3 June at the Quakers' hall with E. P. Thompson and me, denouncing the war, came out with a mild verdict.
How could the BBC, Independent Television News, Independent Radio News or any journalist be expected to pick out anything other than the conclusions of the Franks report before their deadlines at 5 pm or 5.45 pm or the deadline for the first editions? The situation was eloquently put by the perceptive James Naughtie, the chief political correspondent of The Scotsman. Writing in his paper on Thursday 20 January, he said:
What was vital for Mrs. Thatcher was that the first interpretation of the report concentrated as much as possible on the concluding paragraphs, absolving the Government from blame in failing to prevent the junta's invasion of the islands. She succeeded, mainly by employing the oldest trick in the book. 'News management' is what it is called these days, but it is nothing new … When she read the Franks Report, and its long passages detailing Whitehall blunders, the rows between Lord Carrington and Sir John Nott, and the failure of the Overseas and Defence Policy of the Cabinet to discuss the Falklands for 15 months before the invasion despite constant warnings of Argentine aggression, she decided she had to ensure that it was presented in her own way. As a result copies were released at 3.30 pm on Tuesday, as she rose to address the Commons. Back-benchers interested in the Falklands, rushed out of the chamber, to grab a copy from the Vote Office, as did journalists. Mr. Michael Foot, Mr. Roy Jenkins, Mr. David Steel and former Prime Ministers had been given their copies in advance (though in some cases only an hour before) in the traditional courtesy extended to party leaders, but no-one else had a chance.
I feel strongly about the matter, because I gave written and oral evidence to Franks, and it was made very clear by Lord Franks and others that he wanted his report read as a whole, and not taken out of context.
I return to Mr. Naughtie. He said:
Naturally the Prime Minister emphasised the report's conclusion that the Government could not be directly blamed for allowing the Argentine invasion—but it was presented in something of a vacuum. The implicit criticism, not just of

Whitehall's intelligence machinery but of the way in which ministerial discussions were directed by the Prime Minister, was kept well out of sight. Thus the important hours immediately after the release of the report were dominated by Mrs. Thatcher's own interpretation … As one of her officials put it later in the evening: 'It worked.' What he meant, simply, was that the decision to hold back the report until the last minute served its purpose. Downing Street claimed that even after close scrutiny Mrs. Thatcher will emerge unscathed from the report, but officials being officials they wanted to ensure that the Prime Minister herself dictated the way in which it should be first considered".
It was left to the Sunday newspapers, which had more time, to cast a beadier, more careful eye on what Franks actually said. However, by the time the leader of The Sunday Times was printed—it was deeply critical, having had time to read Franks—first impressions had made their mark, and by Sunday, Mr. Ingham and the Prime Minister had succeeded in their task of putting their own gloss on the Franks committee report. Clearly, this was done with forethought, and it is an example of news management. I am not the only one who is concerned, because my right hon. Friend the Leader of the Opposition, after I raised the matter on Tuesday 18 January, at 3.30 pm on a point of order, said that it was a matter to which Parliament would have to return.
I quote from Punch of 2 February. My right hon. Friend the Member for Birmingham, Sparkbrook (Mr. Hattersley) said in his column:
Now that we have all had the opportunity to digest the Franks Report, Mr. Raphael's achievement"—
a reference to the political correspondent of The Observer—
seems even more spectacular. For after weeks of careful sifting, he actually came to the same conclusions as the document's two final paragraphs. The rest of Franks—as all the serious newspapers have now explained—is highly critical of the Government's performance. It takes a journalist of real talent to conduct an independent enquiry and come up, not with the opinions expressed in the body of the report which his investigations mirrored, but with the conflicting judgement with which it ended".
So, in my view, there must have been selective leaking by someone. I have no proof that it was Downing, street. Indeed, there may have been what I can only call "deep-throated" members of the Franks committee giving all sorts of negative and not-so-negative guidance. We all know how effective deep-throated members of a committee can be in semi-leaking. I have to ask, however, in view of the remarkable conclusions of Mr. Raphael and others, before Franks was let out into the public domain: are we so certain that there was not selective leaking? It was my right hon. Friend the Member for Sparkbrook who wrote that it was a very remarkable achievement to get that so right.
I come now to the issue of embargoing. The decision to release at 3.30 pm may have been revenge For the leaking of the Falklands honours list. The honours list was leaked, partly by The Times, which was the first, I believe, to break the embargo. There is, however, more to it than that. The embargo was for an excessively long period, from Thursday 7 October to Monday 11 October. It is perhaps the case that the embargo was not for the convenience of the press but for the political purposes of the Prime Minister who did not want the release of the honours list to compete with a major speech that she was making at the Tory party conference at Brighton. In a sense, the embargo on the honours list for such a period of days was something of an abuse of the system.
It is also true that some Ministers were annoyed about the leaking of the Queen's Christmas message to myself. It was completely understandable that the Queen should refer to the gallantry of service men. The leak occurred because the journalist was appalled that a comparison should be made between the Falklands and the second world war in which both the journalist and myself would have fought against Hitler.
Why did a journalist tell me about Mr. Ingham's proposed guidance to the press the following day at 11.45 and 2.45 on the morning of Tuesday 18 January? You may recall, Mr. Deputy Speaker, that you were in the Chair when I raised a point of order at midnight on Monday 17 January, about which my hon. Friend the Member for Hackney, Central (Mr. Davis) complained on an early morning programme. The leak occurred because the journalist—not a member of the Left-wing press—was professionally and personally outraged at news management. As a token of my good faith, I refused to appear on ITN, "Newsnight" and radio programmes, although invited, on the evening that the Franks report was published because no one could comment on a report of such complexity without having had time to mull it over.
The attitude of the Prime Minister, favouring instant comment, is a bit different. The right hon. Lady said:
I specifically instructed him"—
that is, Mr. Ingham—
not to brief the press either on the paragraphs or in any way."—[Official Report, 18 January 1983; Vol. 35, c. 176.]
This was after the matter had been raised on a point of order. Did Mr. Ingham carry out the Prime Minister's instructions? My right hon. Friend the Member for Sparkbrook, writing in Punch on 26 January, stated:
despite the Prime Minister's stern injunction, Mr. Ingham did come to the aid of the bewildered press. Of course, he did not brief them before they saw the report. But after Mrs. Thatcher's House of Commons statement, some lost souls did ask him 'to give them a quick run-through'. That is how Mr. Ingham describes their requests. And 'if people do not believe' in the innocence of his agreement to help, 'that is their problem'.
So, first, I ask whether a man who has come to behave like an operating thug, who threatens the BBC with incalculable consequences, should continue to be the Downing street press secretary or should be redeployed to other duties. Any threat that could inhibit or which could be seen to inhibit the long-term objectivity of the BBC is a threat to the British national interest.
Secondly, is it healthy that the system should require good journalists to trek daily or twice daily across to Downing Street to meet a chief press officer on the basis of a supplicant relationship, if not being creatures of the Administration at least taking into account the fact that the Ministry is so often the hand that feeds them? Incidentally, that is also true of defence correspondents who become terribly beholden to the Ministry of Defence.
I believe that Donald Maitland suggested that briefings should be on the record, and I am also told that the lobby voted against that when it had the opportunity to pass judgment on it. I just say to members of the lobby that some of us are concerned that the preservation of any lobby mystique might be extremely expensive in terms of journalistic professional integrity. There is a dilemma here which I raise in a serious fashion and which must be discussed, not least by distinguished members of the lobby themselves.
Thirdly, I make a call for the civilised and sensible system of a 48-hour or 72-hour embargo on complex documents to be restored forthwith. The management and manipulation of news is an idea that is alien to the concept of communication in a free society.
Fourthly and finally, in the light of what has occurred, the House of Commons must set up an inquiry into the workings of the lobby and its effect on Britain comprised of Members, editors, journalists and two or three laymen which should report early in the lifetime of the new Parliament. In my view, this has become a matter of urgency and importance in the light of the events surrounding the handling of the Prime Minister's visit to the Falklands and the release of the Franks report.

The Lord President of the Council and Leader of the House of Commons (Mr. John Biffen): The hon. Member for West Lothian (Mr. Dalyell) opened his remarks by making a characteristically kind apology for having kept me here through the night and dragged me to the Dispatch Box to deal with the debate that he has initiated. I dare say that we have a shared experience of national service, when one learned to go through the night wearing one's boots. For all the rigours of the Palace of Westminster, I find that an all night sitting is a good deal more bearable than an all night guard duty.
The hon. Gentleman has raised points of considerable significance and I should like first to congratulate him on his good fortune in securing a place in the ballot for this debate under the new procedures. It is perhaps scant reward for his assiduity that the debate has come on at this witching hour, but I hope that it is of some comfort to him, perhaps more even than it is to me, that I am here to share in the occasion.
I have tried in preparing my remarks to anticipate, as helpfully as I could, the points with which the hon. Gentleman would mainly wish to concern himself in his speech. I say at once that his speech was a most fascinating occasion and the time went very fast. It was highly controversial, but none the less it did not drag. When we ended with the old question of the reform of the lobby system he will understand if the prescience of my modest office was not such that I have come briefed with a comprehensive reply on that and many other points. Having followed the hon. Gentleman's campaign, I am sure that any points that I do not touch upon will not lie neglected. I do not suppose for one moment that this debate will close the topic.
I should like first to deal with the publication of the Franks report and the various suggestions and claims that have been made about it. In doing so, it may be useful if I remind the House of the position as it was then regarding the release of official Government documents and in particular their release to the press.
On a point of order which the hon. Gentleman raised on 18 January he referred to
The civilised and sensible habit of an embargo for the lobby".—[Official Report, 18 January 1983; Vol. 35 c. 171.]
I would not myself dissent from that description, but, for reasons of which the House is well aware, the previous practice of issuing documents overnight on a 24-hour embargo had been discontinued with documents being made available instead only a few hours before publication.
As it so happens, I am very pleased at this stage of my remarks to be able to bring the House up to date. I understand that Lord Marsh, chairman of the Newspaper Publishers' Association, has written a very helpful and constructive letter to the chief press secretary. In it he offers a formal assurance that member companies of the Newspaper Publishers Association will use every endeavour to ensure that embargoes are honoured. The way is now clear for some relaxation of the tight restrictions placed on the operation of the system following the wholesale breach of the Falklands honours and gallantry list embargo in October. I am sure that this will be generally welcomed. However, in his remarks on 18 January, the hon. Gentleman went on to imply that, on this occasion, the absence, as he termed it, of an embargo system had led instead to a process of selective briefing. I can assure the hon. Gentleman that this suggestion is indeed mistaken. The facts of the matter are as follows.
First, my right hon. Friend the Prime Minister took the decision that there should be no advance issue of the Franks report in the form of a "confidential final revise" entirely independently from the restricted embargo system currently in operation. She decided that no one, apart from those to whom such release would obviously be constitutionally proper, should be put in possession of the report before Parliament. The hon. Gentleman would not, I know, wish to contest the propriety of this decision. Accordingly, copies of the report were made available to the press at the same time as they appeared in the Vote Office, which was at 3.30 pm on Tuesday 18 January when my right hon. Friend stood up to make her statement.
Secondly, it has been suggested that the contents of the Franks report were leaked, with the obvious implication that this was done in order to secure an advantage for the Government. I cannot accept that point of view. The report is there and can speak for itself, as I believe it has done. Nevertheless, let me repeat the assurance that my right hon. Friend has already given to the right hon. Gentleman the Leader of the Opposition. There was no leakage from No. 10. Indeed, the hon. Gentleman will no doubt recall the written reply that he himself received from the Prime Minister on the same day—18 January in c. 111—and that reply seems to me to be an entirely satisfactory statement of the position in this respect and I do not think that I can usefully add to it.
Finally, I should like to turn to the suggestion that, in some contorted way, the Government were contriving to give through the press office at No. 10 improper guidance to the lobby on the key paragraph numbers in the report. Here again, I find myself unable to do more than repeat the factual and complete account of the position which the Prime Minister gave to the House on 18 January. Nevertheless, it does seem to me quite unreal to seek to impute into what was planned, or what in practice happened, any attempt to manipulate or mislead.
As my right hon. Friend the Prime Minister explained on 18 January, there was in the event no guidance given to the press on the key paragraphs in the report before it was made available to the House. Previous plans which had been made at the request of the press to extend this assistance with a complex and lengthy document, were dropped following the hon. Gentleman's point of order on 17 January.
I should like to turn now, Mr. Deputy Speaker, to the matter of the Prime Minister's visit to the Falklands. The hon. Gentleman will today have received written replies

from the Prime Minister which I hope he will have found useful. Indeed, he was supplied with a great deal of the structure of the speech that he has made. I think I would be fair in deducing from that that he was not entirely satisfied with the answers he received. No doubt he will return to this topic again.
The hon. Gentleman will not expect me to add any interpretation of my own, but I would like to offer just one observation which I think should not go unsaid.
In linking these two topics—that is, the handling of the Franks report and the Prime Minister's subsequent visit—the hon. Gentleman is evidently seeking to construct a theory of a Government campaign, consciously and assiduously undertaken, to manipulate the news media to their own advantage and so to deprive the public of a fair and impartial interpretation of events. I cannot accept that charge. I commend to the hon. Gentleman the Franks report itself, and in particular annex A thereof, to show that where there have been "mistaken or misleading statements"—and there have indeed been some—these cannot be laid at the Government's door.

Mr. Dalyell: Annex A is fraught with inaccuracy. Part of my oral evidence to Franks was to suggest that the Hercules airliner that landed at Port Stanley in the second week of March was a decoy in the sense that it was the Argentines trying out the runway for weight and length. Franks dismissed that, saying that there had been witnesses to a leaking fuel tank.
The right hon. Gentleman and I have done national service. If we thought that an engine was leaking, and if we were air crew, we would not start off two hours later having had tea and buns at the house of Commander Gammon into the South Atlantic air without repairing it, stripping the engine or finding out what was wrong. This is just a concrete example of where Franks has far too easily dismissed evidence that was available to him. In fact, it is technically ridiculous. Therefore, annex A is open to all sorts of queries.

Mr. Biffen: That demonstrates the real nature of the debate that the hon. Gentleman conducts with an increasing number of people. The target widens. The guilty men and women are not merely to be found on the Treasury Bench. He says that the Franks report is flawed. He must have doubts about the way in which many of his right hon. and hon. Friends conducted themselves throughout the campaign.
The hon. Gentleman is an engaging and resolute campaigner, but there comes a time when these matters must be put into perspective. I have known the hon. Gentleman as a campaigner for many years. Indeed, I hold aloft the very first campaign that I associate with him—the case for ship schools and the book that he kindly gave me to mark his appreciation of my interest.
This debate has taken place in the fairly relaxed circumstances of the Chamber, with all the protection that the Chamber confers on Members of Parliament. We learn that Mr. Bernard Ingham is an operating thug and a truculent and arrogant bully. One would begin to imagine that we had some sort of rough-spoken Yorkshire Rasputin who is manipulating Government and corroding the standards of public morality.
I am happy to endorse and support what the Prime Minister said about Mr. Bernard Ingham and about the quality of service that he confers in his role as a civil


servant. It is easy enough to take someone on, knowing that one is protected within this Chamber, but it is less easy to reflect upon what that may do for a man who has a career as a civil servant, who has had a career independent of the Civil Service and who may well have a future career outside the Civil Service. If the hon. Member for West Lothian wants a target, there are plenty on the Treasury Bench. It in no way enhances the style of debate to pick out Mr. Bernard Ingham for the kind of treatment that he has received today, because character assassination demeans a campaign.

Orders of the Day — Elderly Persons

Mr. David Alton: First, I wish to say something about the debate that has just ended. It is always an experience to listen to the hon. Member for West Lothian (Mr. Dalyell) and to observe the resolute way in which he pursues his arguments about the Franks report and the Falkland Islands. In that respect he is an example to all Back Benchers of the need for determination in pursuing the things that we believe are right. It was equally fascinating to hear the remarks of the Leader of the House. I can only hope that the Minister who is to reply to this debate, which is my first experience of breakfast-time Parliament, will reply as courteously and helpfully as his right hon. Friend replied to the last one.
I wish to deal with the care of the elderly, especially in Liverpool, where in years to come this will be perhaps the biggest challenge after tackling that of unemployment. It is estimated that by the year 2001 the number of people aged over 75 will have risen to about 493,000. The number aged over 85 will increase by 288,000, or 52 per cent. The number aged over 75 who will be housebound or bedfast will rise by about 74,000, and those over 75 who are unable to bathe without help will rise by 200,000. A further 60,000 elderly people will be unable to go out by themselves, and 250,000 more people over 75 will be living alone, including 143,000 over 85 who will be very vulnerable indeed.
The Liverpool director of social services states in a report that the situation in Liverpool will be much the same. He says that the number of men and women aged 65 or over in Great Britain has risen by one third in the past 20 years and now represents about 15 per cent. of the population. There are just over eight million over-65s, or one in seven of the population, and more than three million over-75s. In the city of Liverpool, almost one in four of the population is now over retirement age.
It is easy to become punch drunk with statistics after an all-night sitting, but it is precisely because of the scale of the problem that this is such an important challenge. I wish to raise a variety of matters connected with that challenge.
The number of home helps in Liverpool has doubled since 1973 and there is no charge to the client. That is to the credit of the local authority and I pay tribute to Liverpool city council for the way in which it has responded in that respect. In a letter which arrived yesterday, however, the director of social services makes it clear to me that extra provision will be required. In 1981–82 some 6,500 people, about 6,000 of them over 65, received that service, but there is a waiting list of several hundred. He says that
with the massive problems of the elderly in Liverpool we would certainly like to see extensions, particularly with community based services such as home help provision, which we would intend to extend to cover a 7-day period".
He goes on to say that application is to be made by the local authority within the inner city partnership funding arrangements to try to increase that provision. I hope that the Minister can give us some idea of how that might be received by the Treasury Bench.
There are 1,000 home helps in Liverpool—excluding those involved in the home care service—to deal with the one in four of our population over the age of 65, many of whom are reliant on home help. It is far better that people should stay in their homes than be incarcerated in some


institution for the elderly. It is often the best and most sensitive way to deal with them. Now, it is somewhat ironic that in Liverpool there are 57,000 unemployed on the dole. It costs taxpayers £5,500 per person to keep them unemployed. Would not it be more sensible to use some of that money to put those people into work to deal with the problems of our elderly, especially through increasing the number of home helps?
The home care service was introduced in 1974 and provides an intensive service of help, domiciliary meals and social work support. There were 144 home helps assisting 1,900 clients last year. But the DHSS guidelines, with which the Minister will be familiar, show a need for 967 home care helpers. The present provision proposals, which total 717, reveal a gap of 250, which would be required if the service were to be maintained at the level at which most professionals at work in the field believe is necessary.
Another area of concern is the provision of day care and geriatric care, which was referred to recently as "the silent epidemic." I took the opportunity last week to visit the Royal teaching hospital in Liverpool to talk to its senior geriatricians. I met Mr. Raymond Tallis, the senior lecturer in geriatric medicine, and Dr. Jeremy Playfer. While there, we spoke of the inadequate help available for the elderly in the southern and central sector of Liverpool health authority. I wrote to the Secretary of State on Wednesday setting out the problems at the hospital. I sent a copy of the letter to the chairman of the area health authority. I understand that a meeting later today will discuss the problems of geriatric care.
I want to bring to the Minister's attention the scale of the problem at that hospital and throughout the city of Liverpool. In 1976, Barbara Castle, in her report, recommended that there should be 10 beds for every 1,000 retired persons, and that 50 per cent. of those beds should be in general hospitals such as the Royal. Yet less than 30 per cent. of its beds are available for that purpose. In a city where 25 per cent. of its citizens are over retirement age, that is clearly an unsatisfactory position. There should be 140 acute beds, but there are only 41. In all, there should be 280 beds—140 in the general hospital alone. The position is so bad that the consultants claim that many elderly people are left neglected in their homes because space cannot be made available. They gave me the example of an 82-year-old lady with acute jaundice who cannot be admitted to the hospital because no bed is available. When the elderly are taken into hospital they are often left in general wards and not given the specialist care which the geriatricians believe they should receive.
All that has an inevitable knock-on effect for the remainder of the Health Service. If people are not treated early enough, geriatricians cannot use preventive medicine. So those who could have been short-stay patients become long-stay patients, thereby merely compounding the problem of overcrowding. Had they been short-stay patients, they could have been sent home to live relatively normal lives.
The consultants at the Royal hospital point out that it was built at enormous expense and is probably the most costly hospital built in Britain, yet it laughs at the population surrounding it. It is almost as though the hospital envisages the typical and desirable patient as a young man with appendicitis or a common ailment. It is as though the hospital feels that its training staff are best suited to deal with that group, yet the needs of the

community that surround the hospital are those of a community that has more than its fair share of elderly people and provision for them is actually being reduced.
The consultants said that the Princes Park hospital, which is attached to the Royal hospital, is being considered for closure. If provision is not improved they say we will return to the 1930s. They say that instead of being placed in a pleasant homely environment, many elderly people will end up in a battered old bed in a ward that might overlook a cemetery. What sort of a way is that for us to treat our elderly people? There must be an increase in provision of that service.
The geriatricians told me that many skilled and highly dedicated people came to Liverpool to work for the elderly. When they were interviewed, they were told that they would be given increased resources, especially at the Mossley Hill hospital, where a new ward with day care facilities was to be opened. They were told that the facilities would be pioneered by the Area Health Authority.
Yet, in the past two weeks, the regional health authority has told the area health authority to cut back on that provision. That inevitably means that people who came to the city can now feel only disgust. They have lost morale as they feel despondency creeping into their own lives. Many dedicated staff now feel that the best thing for them to do is to up their roots and go elsewhere. That would be a tragic loss to Liverpool. Professor Williamson, who held the first chair in geriatrics at Liverpool university, which is attached to the hospital, left in disgust in 1976. He said that the service did not measure up to what was required. When I met geriatricians last week they said that nothing had changed. I hope that the Minister will reply to that point.
I next pay tribute to the Liverpool Echo, which last week highlighted the problems of the elderly. As a compassionate and caring journal it recognises the scale of the problem in the city. I commend that article to the Minister.
I have previously raised the issue of providing? incontinence pads to voluntary hostels that are attached to the local authority. The problem is not confined to Liverpool, where I am president of the Liverpool old peoples hostel association. At the hostel that my association runs, at St. Augustine's hostel, and at Stapley Home, they face the problem of having to buy incontinence pads for their elderly patients. I have made representations to the Department and to the local social services committee. This need could be financed legitimately by the DHSS. It is a major overhead for many of the voluntary concerns. The cost often works out at several hundred pounds a month, which must be met out of voluntary funds. It would be much better if that money were released by the DHSS, thus making funds available for the better care of the elderly.
If the voluntary homes close down, statutory provision for old people will have to be made and that will cost the Government a great deal more. On this point, I am grateful to the Minister for his sympathetic replies to the Parliamentary questions that I tabled and the letter that I wrote, but I hope that he will give us more than sympathy today.
The old-age pension was introduced at the turn of the century by a great Liberal Prime Minister, David Lloyd-George. In 1944, the Liberal Member, Sir William Beveridge, made his maiden speech in the House. He said:


I suggest that our aim should be that every British citizen, who works while he can and contributes while he is working and earning, should be assured of an old age without want, without dependence on the young, and without the need for charity or assistance."—[Official Report, 3 November 1944; Vol. 404, c. 1127.]
Today perhaps more than ever the elderly are suffering far more from the effects of inflation than any other group in our society. Since 1974 they have suffered by about 12 per cent. more from inflation than any other group. That is because the basic things that they require, such as heating and food, which are affected more by inflation than any other commodities, form a greater proportion of their household expenditure than in families with more resources at their disposal.
A single person's pension is now worth only 20 per cent. of average male earnings. I should like the link between pensions and earnings to be restored. I hope that the Minister will also give us an assurance that next year the Christmas bonus, which is pitifully below the level at which it should be if it is to keep pace with either inflation or earnings, will be increased to meet people's needs.
In the city of Liverpool one crime is committed every four minutes and one home is burgled about every 17 minutes. Many of the people whose homes are broken into are elderly. If the Minister has had the chance to read my speech when I introduced my Victims of Violent Crimes Bill, he will be aware of the demands that I made for statutory telephone provision and the provision of alarms for elderly people. People who are unemployed could be used to provide those things. If both telephones and alarms could be provided, that would enhance security.
We need increased help through victim support units. I saw the Minister of State, Home Office recently and discussed the problem, together with the hon. Member for Liverpool, Garston (Mr. Thornton). We both pressed the matter on the Minister. I feel strongly that there should be greater statutory provision of victim support units, complementing those of the voluntary organisations. I pay tribute to the work of people such as Joan Jonker on Merseyside, who has done a great deal of work with elderly people who have suffered from violent crime.
One of the other things that we could do to help elderly people who are vulnerable is provide more sheltered accommodation, granny flats and bungalows for the elderly. Often accommodation for the elderly is bigger than it needs to be. How sensible it would be if we built more sheltered accommodation, bungalows and granny flats. This could make available the houses in which they live for families on the waiting lists. If they wished, the elderly would be rehoused in the same area in sheltered blocks where there is both security and independence. In the properties in which they live there is frequently poor wiring because the properties are old and there is inadequate insulation, leaving many people to suffer from hypothermia. It is estimated that 60 per cent. of the lofts of elderly persons' homes have no insulation. That is more work which the unemployed could do.
Many elderly people have become prisoners in their homes. Age Concern says that 750,000 people are at risk from hypothermia. Long hours are spent in cold and uncomfortable surroundings because old people are afraid to turn up the heating because of the cost. Therefore, there should be, first, increased insulation; secondly, increased

fuel allowances, and, thirdly, the savings of the elderly should not be regarded as a disqualification for help, particularly towards heating.
In 1971 the Age Concern manifesto defined the overall needs and aspirations of the elderly as follows:
The elderly need to have sufficient income to meet their needs for social physical and emotional well-being; accommodation which ensures their right to privacy and the retention of their own material possessions; and the freedom to exercise those preferences and prejudices which express their individuality and sense of the past. They need easy access to transport to enable them to supply many of their own wants and to pursue their personal inclinations. They need the security of knowing that, in the event of an emergency, they will not be put at risk through the failure of essential domestic supplies or shortage of basic food stuffs whether living in residential institutions or their own homes, they need the kind of help, care and domiciliary support which will help them to obtain the maximum degree of independent living in spite of increasing infirmities or disabilities.
That was over 10 years ago, and those great challenges remain. We shall be judged by our response to the needs of the elderly. They have served the country well, some in two world wars. Many feel lonely, dejected or isolated. Others are frightened or insecure. If we measure up to the challenge of tackling their problems, we shall have earned the right to call ourselves civilised. I am grateful for the opportunity to raise these important issues this morning and I hope that the Minister will be able to reply to some of those points.

The Under-Secretary of State for Health and Social Security (Mr. Tony Newton): I am not sure that I should be believed if I were to say that I was grateful to the hon. Member for Liverpool, Edge Hill (Mr. Alton) for having kept me here all night in order to deal with this matter this morning. However, even in my slightly bleary state I am prepared to acknowledge that it is important. I certainly recognise the hon. Gentleman's anxiety about the subject.
It is unlikely, in the limited time now available, that I shall be able to cover comprehensively all the points that the hon. Gentleman has raised, but my colleagues at the Department and I will take note of his remarks, together with the letter that he has written to the Secretary of State, which unfortunately I have not yet seen, and the many parliamentary questions that he has asked about this matter over the past few months.
It would be sensible if I were to begin, not by reiterating the Department's official version of the statistics which illustrate the size of the problem that we face, because the hon. Gentleman began his speech by emphasising the numbers of people potentially and actually involved, but by dealing with one or two points which seemed clearly of particular interest to him—the provision of geriatric services in Liverpool against the background of his recent discussions with people in hospital.
The hon. Gentleman will realise that I am constrained by a number of factors, not least of which is the fact that the decisions about the future provision of the strategy on these matters is, if not now, shortly to be discussed by the Liverpool health authority. Indeed, the notes with which I have been kindly provided by my Department have the word "tomorrow" written on them. That is now today.
The hon. Gentleman will know, as I do, that the Liverpool health authority has been considering options for its long-term strategy for some months and is due to consider the detailed strategy at the meeting which is to


take place today. That draft strategy, as the hon. Gentleman said in his speech, has a considerable effect on geriatric provision.
At present there are 707 designated geriatric beds in Liverpool including 93 reserved for patients from south Sefton health authority. In practice, other general medical beds, particularly at Newsham hospital are used for geriatric patients. Mersey region estimates that Liverpool should have about 600 geriatric beds by the end of the decade. The existing beds are located at no fewer than eight sites, including two where contractual beds are used. The hon. Gentleman will surely recognise that there is some scope for rationalisation. In addition, a number of hospital beds are in a poor state of repair.
The health authority is being asked to consider a strategy which will result by the end of the decade in the closure of two hospitals—Princes park and Newsham general. Geriatric patients from Princes park will go to Sefton general hospital and from Newsham beds will be transferred to Mossley Hill, Rathbone and Broadgreen hospitals. The beds used by south Sefton patients will be reprovided at south Sefton itself. There will be other adjustments to geriatric beds at other hospitals.
I want to emphasise that the strategy is not solely interested in bed reductions, because it contains a number of intended positive improvements. For example, a new 95-bed geriatric unit and a 50-place geriatric day hospital are proposed at Broadgreen as part of the plan. Wards at Park hospital will be upgraded and a 50-place day unit will be opened there. Wards at Mossley Hill and Rathbone hospitals will be upgraded also and a geriatric day hospital will be provided on the Royal Liverpool site.
The overall strategy has several objectives, as I understand it, in respect of geriatric services. First—this ties in with some other remarks made by the hon. Gentleman—the general level of community services in the city will be improved. Secondly, an increase is planned in day facilities for the elderly and the elderly severely mentally ill. Thirdly, the strategy proposes an integrated admissions policy for general medicine and geriatric services. Fourthly, the plan is to locate beds in relation to the population served, especially in respect of services for the elderly.
Although, inevitably, I have outlined the broad thrust of the intended strategy under discussion, the hon. Gentleman will understand that I cannot now comment on it, either personally or on behalf of the Department. The strategy has not yet been adopted today, it will then be subject to widespread consultation. If, during that consultation, a health council opposes the closure of Princes park and Newsham general hospital, the ultimate decision on closure will rest with my hon. and learned Friend the Minister for Health, who is present now to show his interest in this matter as well as in another matter that will be discussed in a few moments. It would be wrong, especially in my hon. and learned Friend's hearing, to express my view on the merits of the strategy before consultations have taken place and local opinion has been assessed. However, I assure the hon. Gentleman that my hon. Friends and I will take his remarks into account in considering the strategy.

Mr. Alton: One issue that was raised with me by geriatricians is that rumours have been flying about and statements have been made by the area health authority almost every week to the effect that different hospitals and

wards seem to be at risk. They have not been consulted, and although I am grateful for the presence of the Minister for Health, would it be possible for the Under-Secretary of State or his hon. and learned Friend to meet those geriatricians to discuss their misgivings?

Mr. Newton: My hon. and learned Friend will have noted that request, as I have. It would be inappropriate to go beyond acknowledging it and saying that we shall consider what the hon. Gentleman said, until Liverpool health authority has had its meeting today and we see precisely what is being proposed. Perhaps the appropriate course would be for discussions and consultations to take place between the health authority and those immediately concerned in Liverpool. The hon. Gentleman will understand, for the reasons that I have just outlined, that my hon. and learned Friend would find it a little difficult, at the outset of a process of formal consultation between the health authority and those affected in the area, to become directly involved.
I cannot comment in detail on all the hon. Gentleman"s remarks, but he will appreciate that several of his points—about home helps, the home care service and the provision of sheltered accommodation—are ultimately matters where central Government can exhort, in some cases encourage, or even try to persuade the health authority. However, decisions about the allocation of resources fall ultimately to the local authorities, and especially local social services.
Central Government can ensure—we can fairly claim to have done so already—that the needs of the elderly and the problem of social services in general, against the background of the increased number of elderly people, are given the attention that they deserve. The hon. Gentleman will know that Ministers have emphasised repeatedly the importance that they attach to that aspect of social services provision for both the elderly and the elderly mentally ill, who have tended for many years to be a somewhat neglected group.
There are various ways in which Ministers can show their concern, short of trying to control what happens in detail on the ground. We have shown and will continue to show and develop that concern. Although it is inescapable in the world in which we live, there is never enough money to spend on those matters that we would wish. I hope that the hon. Gentleman recognises that spending on personal social services is about £2 billion, which is about 9 per cent. more in real terms that it was in 1978–79.
That does not accord with some of the gloomier remarks that have been made about what has happened in social services.
What is more important is that the longer-term figures in the Government's recent White Paper continue to give personal social services what has been described as a 2 per cent. lead over average cash increases for local authority services generally. Again, that reflects our recognition of the problems in this area. It is reflected in the forthcoming year by the fact that more than 25 per cent. of the £232 million which has been added to the service figures for 1983–84 has gone to the personal social services despite the fact that personal social services account for only 10 per cent. of local authority current spending.
The number of initiatives that the Government have taken either to provide examples which local authorities may be able to follow in improving their provision or to provide resources for health authorities and local


authorities to develop good new projects and practices to carry forward is now becoming impressive, and perhaps not yet sufficiently recognised.
The hon. Gentleman may remember that, in the middle of last year, my right hon. Friend the Secretary of State announced our intention to go forward with three experimental schemes run by health authorities for nursing homes with a special style of care for elderly people in need of nursing care but based on the provision of homes of about 20 to 30 beds rather than keeping people in large hospitals. We are hoping that one of those experimental homes will be under way by the middle of this year and others early next year. Only a few weeks ago my hon. Friend announced £6 million over the next three years for demonstration development districts, with at least one for each regional health authority. We would provide the funds for comprehensive and integrated service for the elderly mentally ill. Again, it is an example and encouragement to improvement of provision throughout the country.
Within the next week or two, we shall be publishing the new circular entitled "Care in the Community" on improving joint finance arrangements. Again, we are making extra money available to support schemes for getting people out of hospital. Sometimes, that will be the mentally handicapped but it should also include some of the elderly and especially the mentally ill elderly to remove them from hospital and get them back into the community.
In the Bill currently passing through the House of Lords, there are provisions to improve the registration of residential homes, to provide for dual registration of residential homes and nursing homes and to improve the flexibility and quality of the care and the alternatives that are available.
In the context of his remarks about unemployment, the hon. Gentleman may wish to recognise the important steps that we have taken to fund and encourage opportunities for unemployed people to volunteer to help in personal social services. It may not go as far as many people would like, and it is not specifically what the hon. Gentleman suggested, but Age Concern and other large voluntary organisations which have been operating this scheme on our behalf have welcomed it and have pressed us to expand it. Only last week my right hon. Friend was able to respond by announcing the doubling, from £2,500,000 to £5 million, next year of the amount of money we are making available directly through voluntary organisations to fund such schemes. That picks up another of the hon. Gentleman's thoughts.
Although I accept entirely that there is a long way to go and that it will be many years before a Minister can stand here and say that he is satisfied, we are beginning to make some real progress in dealing with the type of problems that the hon. Gentleman has rightly described.

Mr. Anthony Berry (Comptroller of her Majesty's Household): I beg to ask leave to withdraw the motion.

Motion, by leave, withdrawn.

Orders of the Day — Tadworth Court Children's Hospital

Motion made, and Question proposed, That this House do now adjourn.—[Mr. Berry.]

9 am

Mr. George Gardiner: I raise on the Adjournment debate alternative proposals that have been put forward to keep open the Tadworth Court children's hospital. It is fitting that a cause that has aroused such deep national concern as this should be debated twice on the Adjournment of this House. The first was on 1 December, when my hon. and learned Friend the Member for Burton (Mr. Lawrence) and I drew attention to the necessity for saving Tadworth Court children's hospital, threatened with closure under proposals from the Great Ormond Street Group governors in their search for ways out of their financial difficulties.
Today's debate is different. It is about how this can be done. My hon. and learned Friend the Minister now has before him a viable scheme to enable these children suffering from cystic fibrosis, or from a range of physical and mental handicaps, many of a terminal nature, to go on benefiting from the unique care provided at this hospital than can truly be said to have stirred the nation's heart.
In the 10 weeks since the last debate much has happened. The Spastics Society, supported by other voluntary organisations, has drawn up a detailed scheme for the hospital to continue to operate, opening up its respite care facility to far more children in need of it, and at less cost to the DHSS.
Meanwhile I have been working to ascertain what existing and potential support is available from private charitable sources. I can confirm that more than £250,000 has already been either donated or reliably pledged, and that a number of city businessmen are prepared to launch a special appeal to companies and finance institutions, with a target of a further £500,000, in the event of the Minister reprieving Tadworth Court.
In the interval my hon. and learned Friend the Minister for Health has himself visited Tadworth and heard the moving pleas from parents in desperate need of a hospital such as this to which they can turn with total trust. He has also seen the alternative proposed by the Great Ormond Street governors, at Queen Mary's, Carshalton. He showed his concern by replying himself to the first Adjournment debate on this subject and he has done so again by his presence today, for which we are all most grateful.
Before outlining the Spastics Society scheme, which I strongly commend, let me explain why the society felt moved to bring it forward. After examining the proposed alternative at Queen Mary's, the society's professional and medical staff reached the same conclusion as the parents, consultants and everyone concerned with Tadworth—that as an option Queen Mary's was inferior in many respects.
Though an excellent acute children's hospital, it is not suitable even with the upgrading of wards for the sick and disabled children now nursed at Tadworth. It is a large unit, with more than half its patients adult mentally handicapped, and with inferior rehabilitation facilities—an inadequate hydrotherapy pool compared with Tadworth's, restricted access for parents, and nothing to equal the summer holiday facility offered at Tadworth for children who will never see a holiday of any other kind.
Though a good hospital for other categories of patients, Queen Mary's is large and lacks the homely ambience of Tadworth. The Spastics Society is committed to moving children from large institutions into more appropriate forms of care, as the Government themselves envisage in their policy for "Care in the Community".
I turn now to its alternative plan, the details of which result from extensive consultation with DHSS officials and with health administrators on the ground.
First, Tadworth court would be taken out of the Great Ormond Street group and administered as a separate unit. This could take the form of a special health authority, or a newly formed charitable trust. On these options we have an open mind.
Secondly, savings would be made in the running of the hospital and from removal of the obligation to maintain unwanted properties. The society has already suggested savings amounting to £400,000 a year.
Thirdly, the respite care facility at the hospital would be opened out to take children referred directly to it by local authorities. The Spastics Society's experience here would be particularly valuable. Already it runs a small home for under-16s at Bury St. Edmunds, at a sponsorship rate of £168 per week. This is regularly supported by seven county authorities—proof that when such a facility exists it will be used. A further five neighbouring local authorities have already indicated interest in placing cases at Tadworth court.
Fourthly, the Spastics Society itself will make an input to the management team. I hope that the Minister will agree with the recent comment in the Financial Times that
no one is likely to question the administrative or professional competence of the Spastics Society to lead the task.
Then there is the question of sale of land. The Great Ormond Street governors want to sell the entire site of 62 acres with outline permission for low density housing development, although I can see great difficulties in them obtaining that. We would prefer to sell the 34 acres not required for hospital use, with the proceeds—estimated by valuers at £1·7 million—used to help support the children at Tadworth court, which would seem to be only just. Planning permission in these circumstances would be much more likely.
The Spastics Society plan would, of course, require a continuing commitment though probably a declining one, from the DHSS. This is estimated at £750,000 for each of the next three years, to be fixed at a lower level thereafter as local authorities refer more cases, which they are barred from doing at present. Seven hundred and fifty thousand pounds a year may sound a lot, but it must be set beside the £400,000 that it is proposed to pay Queen Mary's to care for these children—a figure that many believe to be excessively low. Nor should we forget the capital cost of at least £320,000 required to bring the designated wards at Queen Mary's up to even the minimum standard.
Finally, there is the vast potential for funding from private sources. In the debate on 1 December I spoke proudly of £7,000 in our local Tadworth Court appeal fund. In the weeks since, that has soared to £60,000, without any donations being solicited on our part. I spoke hopefully of a survival fund of £250,000. That figure has now been passed, in donations into different appeal funds and pledges of support from major charitable bodies, including the Genesis Foundation in the United States of America. Now business men are talking of raising a further £500,000 which those with experience of such appeals tell

me is certainly an attainable target for a cause such as this. However, I must stress that all these donations will have to be returned, and all these firm pledges will go up in smoke, if the Minister denies Tadworth Court the future that everyone wants.
In conclusion I would say this. Both my hon. and learned Friend the Minister and the Secretary of State have spoken eloquently of the concept of partnership in the Health Service. As the Secretary of State told the BMA last December:
We need partnership—partnership with local authorities, particularly their personal social services departments, partnership with voluntary organisations.
What better example, what better chance of partnership in practice, could he have than the viable scheme for Tadworth Court before him now from the Spastics Society, involving other voluntary organisations and local authorities, and supported by the income from an endowment fund of some £750,000 raised from private donations?
I do not believe that this is an opportunity for partnership in the aid of sick and severely handicapped children that the Minister can possibly reject. In the name of these children, of others who will need such care in the future, of their suffering parents, of the consultants and of the charities involved, I appeal to him to seize it, and to announce that he is giving Tadworth Court his full support.

The Minister for Health (Mr. Kenneth Clarke): I congratulate my hon. Friend the Member for Reigate (Mr. Gardiner) on raising such an important matter in the House for the second time in 10 weeks. Throughout discussions about the future of Tadworth Court, he has taken a leading part in the public debate, as his own constituents are directly affected. In the intervening period since we last had a debate my hon. Friend, my hon. Friend the Member for Carshalton (Mr. Forman), and I have visited the two hospitals. We all took the view that it would be quite wrong for Ministers to take any decisions on such an issue without having seen the hospitals for themselves.
My hon. Friend the Member for Reigate has also taken the lead in the preliminaries of raising substantial sums of money, which he believes could be available, and that reflects the very considerable concern about the future of the hospital. Among the several meetings that I have had with those directly involved in the problems of Tadworth Court, I have had meetings with my hon. Friend, and he has gone over the way in which he anticipates being able to raise substantial sums if the hospital can be saved.
I should have liked to respond to the plea that my hon. Friend the Member for Reigate made at the end of his speech and to have announced a decision this morning. Last week I was abroad for a brief time and there was newspaper speculation that a decision had already been reached and could be announced this week in the House. That is not the case. No decision has yet been reached. I say that with some regret, because I realise that the continuing uncertainty causes difficulty to everyone involved and we should come to a clear conclusion as quickly as possible.
On the other hand, it has not proved possible to come to that quick decision and at the same time to do justice to the very many arguments involved and in particular, to the efforts being made by my hon. Friend the Member for Reigate and those who are supporting him and by the


Spastics Society. The ideas that he puts forward have an obvious attraction, but to ensure that we are not simply continuing uncertainty and that we are judging the best use of funds and resources as objectively as such vast sums require, it has been necessary to study in considerable detail and depth the proposals that are being made.
We have examined the proposals of my hon. Friend the Member for Reigate and the charity's proposals, and today, I have a further meeting booked with Mr. Tim Yeo and the Spastics Society, at which it will be necessary to go over yet further details. The Government and I hope to come to a conclusion as quickly as possible once we have all the necessary information and have evaluated it with the necessary care.
While this anxious debate has been going on, the Government have ensured that services at all the hospitals in the Great Ormond Street group of hospitals continue at their present level, and without interruption, at least until the end of the current financial year. It shows the size of the problems with which the governors of Great Ormond Street and the Government are wrestling when I say that we have devoted £½ million of central funds from the taxpayers' money to keep the present level of services at both Great Ormond Street and Tadworth Court continuing on the present basis, at least until the end of the current financial year.
As I have not taken a decision, it is obviously not possible for me to go into much further depth this morning. However, I re-emphasise—to allay some of the strongest alarms that some members of the public have expressed about the proposal—that the proposal before Ministers at the moment is not, and never has been, the ending of the services provided to the children at Tadworth Court. The proposal put forward by the governors of Great Ormond street would have allowed for the transfer of all services to the Queen Mary's hospital for children at Carshalton, where accommodation is available about four miles away from the present site of Tadworth Court. The proposal always envisaged the children being in the care of the same consultants as care for them now, and would have provided an opportunity for many of the Tadworth nurses to transfer with the children if they wished.
The main issue that has been raised by those who challenge the Government's proposal is whether not only the basic services could be provided by the same people to the children at Queen Mary's, Carshalton, but whether the nature of the care provided at Tadworth is so unique and dependent on the individual characteristics of this small hospital that it could not be recreated in the larger unit. Also, I have been very aware of the great worry felt by parents and children, who are subjected to the stress that families experience in some of the cases at Tadworth Court, at any suggestion of change to well established and sensitive arrangements.
That is the proposal. I should add that some people, in campaigning, have been rather carried away into attacks on the quality of the care at Queen Mary's hospital for children at Carshalton. The people at that hospital have shown great understanding and forbearance in not replying to those attacks. I have visited Queen Mary's, and I was extremely impressed by the dedication and commitment of all the staff there. My hon. Friend said today that he entirely supported my view that Queen Mary's is a highly successful hospital. We have to consider whether the

nature of the layout and the environment at Queen Mary's would—or would not—allow a successful transfer of all the qualities of the service at present provided at Tadworth Court.
The charities proposal would of course be supplemented by my hon. Friend's efforts to raise substantial funds for investment. As I said, it is still necessary to appraise the proposal in detail. The fact that we have already spent £500,000 in keeping the present services going while these proposals are worked out shows the formidable nature of the sums of money that are involved. Clearly, no Government, however sympathetic to the case, can accept that Tadworth must continue at any cost. Indeed, no one now suggests that Tadworth Court should continue exactly the same as before. All the proposals presuppose the sale and development of some of the substantial surplus land that is on the site, and include suggestions to improve the occupancy rate of a hospital where at present only about half the places are taken up by patients. We must ensure that the substantial resources, capital, revenue and staff are used in the most effective way, so as to benefit a maximum number of parents and sick children and to keep the highest quality of services in all the hospitals that are involved.
I want to say a word in defence of the board of governors. I have already said a few words in defence of Queen Mary's, Carshalton. The board has been somewhat unreasonably misunderstood at times when people have criticised it for putting forward its proposals. The board is faced with the conflicting needs of the three important hospitals for which it is responsible. The doctors at Great Ormond Street hospital are continually developing highly specialised new methods of treating malignant disease, diagnosis and treatment of renal disease, and the development of new surgical techniques in the neonate. The results of those developments at one of our greatest children's hospitals is that the cost of providing services there steadily rises, and at times threatens to outstrip the increased resources which the Government keep giving the board.
So the board looked at the problems of financing its three hospitals. The board itself originally proposed to reduce the number of beds at Tadworth to improve occupancy and to sell off surplus land. The board's original proposals were similar in some respects to those now being put forward by the charities. However, at the time those proposals were strongly resisted by the Tadworth staff and by local interests. After that, the board, in consultation with the Merton and Sutton health authority, developed the proposal to transfer all services to Queen Mary's, and decided to put the proposal to Ministers. The board has throughout acted entirely properly. Its main motive has been to show how it thought it could make resources available to develop better methods of treatment for more people, while safeguarding the services now provided at Tadworth. I am quite sure that the board's intentions and purposes have been beyond doubt throughout.
The decision now rests with Ministers. I have to consider the moving experience of my visit to the two hospitals and the appeals put to me by those with an interest in the matter. I have also to examine the mechanics, the figures and the viability of the proposals being proposed by the Spastics Society, so formidably and valiantly supported by my hon. Friend the Member for Reigate. I can only repeat what I hope I have already made clear. The main consideration of Ministers in deciding this


difficult matter will be to do what we consider to be right in the interests of sick children, their parents and families. The whole purpose of the Health Service, especially in this area, is to make the maximum effective use of resources available to provide for the highest standards of care for sick children and the best levels of support for those families who have sick children within their midst.
That must be our first concern. It is concern for the sick children and their parents that has moved substantial numbers of members of the public to express their interest in the subject and to put so much support behind my hon. Friend's campaign. I am grateful to all those who have taken part in the debate ranging from the hospital

governors, those at Queen Mary's and Tadworth Court, my hon. Friend the Member for Reigate, the Spastics Society and members of the public who have sometimes put conflicting proposals to ministers but who are all anxious to do the best for sick children and their families.
A decision has to be made shortly when we have evaluated the various proposals. I undertake to my hon. Friend that he will be among the first to know, although I hope that everyone will know precisely where the future lies for these services within the next few weeks.

Question put and agreed to.

Adjourned accordingly at twenty-one minutes past Nine o'clock am.